UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-2168
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ACTIVA MUTUAL FUND TRUST
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(Exact name of registrant as specified in charter)
2905 Lucerne Dr. SE, Suite 200
Grand Rapids, Michigan 49546-7116
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(Address of principal executive offices) (Zip code)
Allan D. Engel, President, Secretary, and Treasurer Activa Mutual Fund Trust
2905 Lucerne Dr SE, Suite 200
Grand Rapids, Michigan 49546-7116
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(Name and address of agent for service)
Registrant's telephone number, including area code: (616) 588-5380
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Date of fiscal year end: December 31
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Date of reporting period: June 30, 2008
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO SHAREHOLDERS.
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The attached Semiannual Report to Shareholders was mailed on August 29, 2008.
Logo: Activa
Semiannual Report
June 30, 2008
ACTIVA INTERMEDIATE BOND FUND
Sub-Adviser: McDonnell Investment
Management, LLC
ACTIVA VALUE FUND
Sub-Adviser: Wellington Management
Company, LLP
ACTIVA GROWTH FUND
Sub-Adviser: BlackRock Capital
Management, Inc.
ACTIVA INTERNATIONAL FUND
Sub-Adviser: Tradewinds Global
Investors, LLC
A selection of stock and bond funds, managed by professional advisers, which are
designed to help investors meet their financial goals.
Logo: Activa Mutual Funds
ACTIVA Mutual Funds Semiannual Report
Contents
Page
SHAREHOLDER LETTER 1
ACTIVA INTERMEDIATE BOND FUND 2
ACTIVA VALUE FUND 3
ACTIVA GROWTH FUND 5
ACTIVA INTERNATIONAL FUND 6
ACTIVA PORTFOLIO HIGHLIGHTS 8
ACTIVA ADDITIONAL INFORMATION 10
ACTIVA OFFICERS AND TRUSTEES OF THE FUND 13
SCHEDULE OF INVESTMENTS
Activa Intermediate Bond Fund 15
Activa Value Fund 20
Activa Growth Fund 24
Activa International Fund 28
Page
STATEMENT OF ASSETS AND LIABILITIES 32
STATEMENT OF OPERATIONS 33
STATEMENT OF CHANGES IN NET ASSETS 34
NOTES TO FINANCIAL STATEMENTS 36
FINANCIAL HIGHLIGHTS 42
The views and opinions in this report were current as of June 30, 2008. They are
not guarantees of performance or investment results and should not be taken as
investment advice. Investment decisions reflect a variety of factors, and the
managers reserve the right to change their views about individual stocks,
sectors, and the markets at any time. As a result, the views expressed should
not be relied upon as a forecast of the funds' future investment intents.
Activa Mutual Funds
2905 Lucerne SE, Suite 200
Grand Rapids, Michigan 49546
(800) 346-2670
WWW.ACTIVAFUNDS.COM
SEMIANNUAL REPORT
DEAR SHAREHOLDER:
During the first six months of 2008, the first quarter retrospectively seemed
somewhat stable due to action taken by the Federal Reserve to stabilize credit
markets. Volatility became the theme of the second quarter, with most major
markets indices finishing the 6-month period with negative returns. The Dow
Jones Industrial Average declined more than 13%. The U.S. broader markets also
declined with The Standard & Poor's 500 Index and the NASDAQ Composite finishing
the period -11.9% and -13.5% respectively. Unlike the previous periods the
overseas markets also experienced increased volatility as measured by the MSCI
EAFE Index, finishing the 6-month period -10.6%.
Although many investors know that volatility and uncertainty may be present in
the markets, the previous six months have been increasingly turbulent. During
these times, we recognize that investors may be more inclined to focus on
short-term performance. However, it is important to remember that history has
shown that creation of wealth is a long-term venture. We believe that a
long-term plan includes an investment strategy of allocating your investment
holdings across the major asset classes, diversifying within each class, and
regularly rebalancing your portfolio to maintain the desired allocation.
Although this strategy cannot guarantee a profit or protect against a loss, it
is an approach which may potentially allow you to capitalize on the many
opportunities the financial markets can offer.
During these unpredictable markets, our sub-advisers and their portfolio
managers have proceeded with the skill and perspective that their experience has
provided them. They have been proactive in managing your investments in these
market environments, identifying and evaluating risks, and utilizing their
investment expertise. We are pleased to note that over this short term period
most of our Funds have outperformed their benchmarks on a relative basis.
Although pleased with this outcome, we continue to monitor the sub-advisers'
results and abilities to invest appropriately in these challenging markets.
Following in this report you will find their management discussion and review of
fund results. In addition, you will find graphic illustrations and tables
highlighting the diversification and significant holdings of each of the Funds.
Investing regularly along with an automatic investment plan can help to relieve
the anxiousness and emotion from investing. Dollar cost averaging involves
investing a certain amount of money in the same fund at the same time each month
or quarter. By investing the same dollar amount on a periodic basis in the same
fund you may pay a lower average cost per share. Although dollar cost averaging
does not guarantee a profit, it does encourage discipline, eliminate the need to
decide when to invest, and avoid the temptation to time the market. Activa
Mutual Funds can help you maintain an investment program by establishing an
automatic investment program from your bank account. You choose the dollar
amount (minimum $50), time periods, and Activa Funds you want to invest in. Call
an Activa Investor Services Representative (1-800-346-2670) to further discuss
dollar cost averaging and how you can establish an automatic investment program.
Activa Management Services, LLC is excited to announce the launch of our new
web-site, activaservices.com. The site will offer many features including the
option to view and use enhanced financial planning products along with Activa's
Travel and Health services. The financial planning tools include retirement
planning, education funding and the ability to create your own diversified asset
allocation strategy. Please visit our new site to see Activa's full slate of
services.
We here at Activa funds thank you for your support of our Fund family and we
will continue to make it our priority to bring you the highest level of quality
and service.
Sincerely,
/s/ Allan D. Engel
Allan D. Engel
President
ACTIVA Mutual Funds Semiannual Report 1
ACTIVA Intermediate Bond Fund -- McDonnell Investment Management, LLC
MARKET PERSPECTIVE
Amid ongoing concerns related to financial sector liquidity, the Federal Reserve
(the Fed) reduced the Federal Funds rate by 225 basis points in the first half
of 2008. The Fed acted in concert with other central banks including the
European Central Bank to ensure global liquidity needs were met. The combination
of these events resulted in a decline in short to intermediate US treasury
yields. The yield on the two and five year treasury notes declined from 3.05% to
2.62% and from 3.44% to 3.33%, respectively. However, yield on the 30 year
treasury bond increased from 4.45% to 4.52% as signs of increased inflation risk
remained in the market. Although core inflation moderated over the course of the
period, investors remained concerned about the potential long term inflation
effects of the rate cuts, high energy and commodity prices and a weaker dollar.
This also contributed to a steepening of the treasury yield curve as the yield
difference between 2-year and 30-year treasuries increased by .50%. US economic
growth remained moderate running at approximate 1% annualized rate. Market
volatility is expected to remain elevated as the credit crisis and bursting of
the housing bubble work their way through the broader economy and financial
markets.
PORTFOLIO HIGHLIGHTS
For the six month period, lower quality, higher yielding securities
underperformed as investors sought the safety and principal protection offered
by US Treasury and higher quality securities. In addition, the weakening US
dollar enhanced the value of high quality, non-US dollar denominated securities.
As a result, the Fund reduced exposure to lower quality securities and increased
its weighting in higher quality securities including non-US dollar denominated
securities. In particular, the Fund took continued steps to reduce exposure to
the finance, housing and mortgage sectors over the course of the period. In
addition, the Fund maintained a modest, positive, relative duration posture as
well as an overweight position in intermediate maturity securities (3 - 10 year
maturities).
PERFORMANCE SUMMARY
The Fund generated a total return of 1.14% for the six month period ended June
30, 2008. By comparison the Lehman Brothers Aggregate Bond Fund returned 1.13%
for the same period. Overall the Fund's relative return benefited from its
exposure to high quality, non-U.S. sovereign securities, positive duration
posture and an overweight in intermediate maturity securities. Detractors from
the Fund's relative return included an overweight in the mortgage and
asset-backed sectors.
2 ACTIVA Mutual Funds Semiannual Report
ACTIVA Value Fund -- Wellington Management Company, LLP
MARKET COMMENT
Equity markets continued their downward spiral during the first six months of
2008. Early in the year, equity markets were buoyed by Fed actions and the
perception of stabilizing credit markets. However, stocks began to quickly
retreat in the latter half of the period, as rising commodity prices stoked
inflation concerns and continued weakness in the US housing market reignited
economic concerns and credit market fears. Mid cap stocks led large caps and
small caps over the first half of the year when measured using the S&P MidCap
400, the S&P 500 and the Russell 2000 Indexes. Growth outperformed value as the
Russell 1000 Growth Index returned -9.1% and the Russell 1000 Value Index
returned -13.6%. Within the Russell 1000 Value index, all broad sectors except
for Energy posted negative results.
FUND REVIEW
Despite the volatile market environment, the Activa Value Fund continues to post
strong performance relative to the benchmark. During the six-month period ended
June 30, 2008, the Activa Value Fund returned -10.59% net of expenses,
outperforming the -13.57% return of the Russell 1000 Value index. Longer-term
comparisons also remain favorable.
The Sub-Adviser focuses on stock selection within industries; rather than making
significant sector bets, industry weights are kept in line with those of the
Russell 1000 Value Index. The Sub-Adviser uses an internally-developed,
quantitative analytical approach to complement fundamental or "bottom-up"
security analysis research.
For the first half of the year, the Fund's bottom-up investment approach
produced positive benchmark-relative results in six out of ten broad market
sectors. Strong security selection within the Financials, Materials, and
Information Technology sectors contributed most to positive results while Energy
and Industrials marginally detracted.
The Financial's sector outperformed on a relative basis, buoyed by our
positioning in American International Group, Citigroup and Assurant. Our
underweight position in both American International Group and Citigroup proved
additive to the Fund's performance as both companies continue to be hurt by
exposure to US subprime related assets. Our overweight positioning in global
insurance product provider, Assurant, positively contributed, as shares rose on
better than expected profits and news that the company would raise its quarterly
dividend by 17%.
The largest absolute and relative contributor to the Fund was biopharmaceutical
company, Millennium, whose shares skyrocketed after it announced that it would
be acquired by Japan-based Takeda Pharmaceuticals.
Within the Materials sector, Mosaic, U.S. Steel and Freeport-McMoRan contributed
to the Fund's performance. All three companies benefited from rising commodity
prices.
The Information Technology sector was also a strong spot for the Fund after
Accenture reported higher-than-expected profits despite worries of a weaker US
economy and financial sector.
In the Energy sector, our underweight to Chevron combined with avoiding
benchmark names Apache and EOG Resources slightly detracted from the Fund's
overall performance, as did not holding an Industrials stock CSX.
Our overweight position in Bank of America was one of the largest absolute and
relative detractors in the Fund. Shares of the diversified financial company
fell throughout the period amid rising credit losses, a deteriorating home
equity portfolio and weaker consumer trends.
OUTLOOK
The objective of the Value Fund is to provide long-term total returns in excess
of the Russell 1000 Value Index and is intended to be suitable as a US large-cap
value investment. The Portfolio attempts to add value by combining Wellington
Management's proprietary fundamental and quantitative research in a disciplined
framework to build a portfolio of the most attractive large cap value stocks.
The Portfolio focuses on stock selection as the key driver of returns and uses
quantitative portfolio construction
ACTIVA Mutual Funds Semiannual Report 3
ACTIVA Value Fund continued -- Wellington Management Company, LLP
techniques to build a portfolio insulated from factors that may cause serious
under performance versus the benchmark to avoid surprises from unintended,
uncompensated "risks." These factors for the Value Fund include consistent value
orientation, while minimizing exposure to foreign stocks, cash positions,
overexposure to small cap or mid cap stocks and excessive industrial sector
bets. These exposures are managed within a set range and monitored for their
impact on overall portfolio risk to focus active risk on stock selection.
4 ACTIVA Mutual Funds Semiannual Report
ACTIVA Growth Fund -- BlackRock Capital Management, Inc.
PERFORMANCE SUMMARY
Surging energy and food prices, fear of recession, and continued dislocations in
the financial sector have produced a very challenging environment for equities
thus far in 2008. A 45% increase in oil prices combined with a 75% jump in
natural gas prices have created a positive backdrop for energy stocks, while
creating major headwinds for the U.S. consumer and other segments of the global
economy. The Russell 1000 Growth Index significantly outperformed the Russell
1000 Value Index, in large part due to the lower weighting in financials for the
Russell 1000 Growth, but still registered a negative return.
The Growth Fund also declined during the first half of 2008, down 4.87%, but
effectively protected investor capital, significantly outperforming the 9.06%
decline posted by its benchmark the Russell 1000 Growth Index. Stock selection
accounted for the majority of the outperformance, with the strongest relative
results being posted in the energy, health care, and information technology
sectors. Sector positioning also added value, as the portfolio held underweights
in the poor performing consumer discretionary and financials sectors.
PORTFOLIO REVIEW
The energy sector delivered many headlines during the quarter with crude oil
rising sharply and flirting with $150/barrel. Higher energy prices have boosted
both producers and services companies in 2008, as slowing global growth has not
yet improved the current supply/demand dynamic. The Fund's investment in energy
producers, coal miners in particular, delivered excellent returns in the second
quarter. Massey Energy, a recent addition to the portfolio, skyrocketed after
announcing an increase in production amid dramatically higher coal prices.
Consol Energy is also benefiting from this tight coal market, while Petroleo
Brasileiro S/A moved higher as a result of the company's recent offshore oil
discoveries.
In health care, strength in pharmaceuticals and biotechnology powered absolute
and relative returns. Elan Pharmaceuticals delivered the greatest impact in
health care. Shares of the company ran up in anticipation of, and in response
to, the company's report of encouraging data for its Alzheimer's drug in
development, bapineuzumab. Celgene Corp. and Gilead Sciences, Inc. both produced
double-digit returns in biotechnology. Also in health care, our relative lack of
exposure to the managed care companies paid off as these companies fell 30% on
average due to challenging industry trends.
Stock selection decisions also produced relative outperformance in the
information technology sector. In software, videogame publisher Activision rose
significantly after reporting excellent fourth quarter earnings and raising
earnings guidance for 2009. Qualcomm, a top portfolio holding, boosted results
in communications equipment with its 13% rise amid the hostile market
environment. The materials, industrials and consumer staples sectors all
featured positive stock selection, while the consumer discretionary sector was
the lone sector to experience underperformance during the 6-month period.
PORTFOLIO POSITIONING AND OUTLOOK
The portfolio continues to be managed from the bottom-up. As such, all stock
selection decisions made during the period resulted from stock-specific
developments and were not made in reaction to, or in anticipation of, broad
economic and market conditions.
During the period our allocation to energy rose as a result of market
appreciation and the addition of Massey Energy and Cameron International. As a
result of the annual reconstitution of the Russell 1000 Growth Index, our
underweight in information technology increased while our relative underweight
in consumer discretionary narrowed. As of 6/30/08, the portfolio holds
significant overweights in the health care, telecommunication services and
consumer staples industries while maintaining underweights in technology and
consumer discretionary.
ACTIVA Mutual Funds Semiannual Report 5
ACTIVA International Fund -- Tradewinds Global Investors, LLC
ACTIVA FIRST HALF 2008 COMMENTARY REVIEW
In the first half of 2008, the market continued to experience the volatility
which began in the second half of 2007. Most major global indices posted
negative returns, with the benchmark MSCI EAFE Index falling nearly 11% in the
period. In US dollar terms, Japan was one of the better performing markets,
declining just over 5% during the period. The crisis in the financials sector
took hold in the US and Europe, and write-down's and capital raisings eclipsed
anything seen to date. Inflation fears continued to concern investors, with the
oil price continuing to hit new highs and food and energy inflation finally
showing the inevitable impact on core CPI numbers. Growth significantly
outperformed value for the period, and resource companies, in both the Energy
and Materials sectors, easily outperformed consumer and financial related
companies. Most major markets, including the US, entered bear market territory.
Once again, the Fund outperformed the benchmark MSCI EAFE; while the Fund ended
the period with a return of roughly -3.30%, the benchmark lost ground for the
third quarter in a row, declining to roughly -10.60% for the first six months of
the year. From a sector perspective, relative outperformance, came from most
sectors, particularly the underweight in Financials, and overweight in
Information Technology, Consumer holdings, Telecom and Energy. Currency returns
had a small negative impact on returns. In general, the euro and other European
currencies strengthened against the US dollar, as did the Japanese yen. On the
other hand, the South African Rand and the South Korean Won lost ground against
the dollar. From a regional perspective, Canada was the greatest contributor to
relative outperformance.
Financials led many of the market headlines in the media throughout the first
half of 2008, as high-profile bankruptcies, takeovers, and bailouts tormented
investors. From a sector perspective, the Fund's significant underweight in
Financials was the largest contributor to relative performance. As the markets
attempted to digest the seemingly endless barrage of bad news and speculation of
further troubles, investors in Financials realized they were suffering from
years of gorging in the sector. While for the past few years we have maintained
significant underexposure to the sector, as we viewed the environment in which
many of the companies were operating to be unsustainable, we have recently begun
to modestly and selectively add to the sector, since not unexpectedly, the
turmoil has also led to the uncovering of investment opportunities.
Both the Consumer Staples and the Consumer Discretionary sectors added
significantly to performance relative to the benchmark. While the holdings
therein had mostly negative returns for the period, these paled in comparison to
how these sectors performed in the index, as concerns about a global slowdown
and rising inflation led many investors to question the future earnings
potential of these companies. Within these sectors, the standout performer in
the group was Premiere AG, the German media company, which benefited from a
large investment by News Corp., and speculation of additional investments or
even a possible takeover.
While most of our Technology holdings were down during the period, Technology
was one of the largest contributors to relative outperformance, due in part to
the overweight position in the portfolio. Gemalto was the best performing
Technology holding, and the top contributor to relative outperformance in the
portfolio. At a time when the market for mobile devices has been experiencing a
slowdown, shares of the French company, the largest global manufacturer of smart
cards used in mobile telephones, appreciated on improving profit margins brought
about by a recent restructuring and capital investments. Ericsson and
Alcatel-Lucent, the Swedish and Franco-American telecom equipment makers,
respectively, continued to be laggards, principally over concerns of increased
competition and over-capacity in the industry.
Health Care and Utilities, while small weights in the portfolio relative to the
benchmark, were the greatest detractors from performance. In the Health Care
sector, Sanofi-Aventis was the worst performing stock, while in the Utilities
sector, Korea Electric Power was the culprit.
Telecom was overweight in the portfolio relative to the benchmark, and a
significant contributor to performance. Within the Telecom Sector, Chunghwa
Telecom of Taiwan was
6 ACTIVA Mutual Funds Semiannual Report
ACTIVA International Fund -- Tradewinds Global Investors, LLC
the best performing holding in the sector, after local regulators allowed the
company to return additional capital to shareholders. We sold out of the
position amid the rise in the stock from the positive news. The worst performing
holding in the sector, and the largest detractor to performance in the
portfolio, was Telecom Italia. The company's shares were punished after
announcing lower earnings and cash flow for the year, and consequently
decreasing its dividend payout.
The Materials sector, in which the Fund has a significant overweight relative to
the benchmark, was a small contributor to performance. Newmont Mining Corp.,
based in the US but with assets and operations throughout the Americas, Africa,
Asia, and Australia, was the best performing stock in the sector. Two paper
companies, Stora Enso Corp. and UPM Kymmene Corp., both from Finland, were some
of the worst performing stocks within the sector, and some of the largest
detractors from performance in the portfolio. Both companies issued profit
warnings during the second quarter, citing escalating wood and energy costs, as
well as negative impact from foreign exchange. Stora Enso, in particular, was
hindered by unscheduled maintenance issues as well as strikes at some of its
Finnish operations, leading it to be the second largest detractor from
performance in the portfolio.
The Energy sector was also a large contributor to outperformance, in large part
due to the Fund's overweight position relative to the benchmark. Opti Canada was
the best performing stock within the sector. The company's perceived risk was
lowered upon completion of its largest project and ramp up in production. We
continue to maintain a well-diversified portfolio of energy companies, both
geographically, and within the context of the segments of the market in which
they operate, from exploration and production in Canadian oil sands, to the
major integrated companies.
Anyone reading our commentaries over recent years would have become accustomed
to our bearish stance on global equities. This stance did not pay off in some
periods, but has paid off handsomely, at least on a relative basis year-to-date.
While focusing on the absolute value of companies, rather than on a relative
basis it can sometimes be hard to shield an entire portfolio from negative
global sentiment. To that end, we have been overweight in the gold mining
sector, owning companies which trade at a significant discount to the spot price
of the metal, while at the same time believing that in times of turmoil the gold
price tends to do well. While trimming at the margin we continue to maintain
this exposure. We have also maintained our overweight exposure to Japan. We are
not buying Japan for macro reasons but given the fact that we can find many
companies in that market which fit our value criteria - that said, Japan has
been a significant global laggard for many years, so we are not too surprised by
its recent outperformance.
While it is sometimes difficult to look at falling markets and see opportunity,
that is just what we do. This means we have the opportunity to build stronger
portfolios for potentially greater future returns. While some clients may look
to take money away from equity markets for tactical reasons, we know that the
only way to grow wealth over the long term is not to shy away from investing but
to embrace the opportunity to buy quality franchises at discounts to their
intrinsic worth. While the US and some other Anglo and European countries may be
going through tremendous economic volatility driven by the excesses of recent
years, money can still be made focusing on investing in companies rather than
buying markets.
ACTIVA Mutual Funds Semiannual Report 7
ACTIVA Portfolio Highlights (Unaudited)
ACTIVA Intermediate Bond Fund
Pie Chart:
Quality Diversification
as of 6/30/08
U.S. Government and U.S. Government Agency Obligations 54%
BBB 9%*
A 13%
AA 6%
AAA 18%
* Category reflects ratings by one nationally recognized rating agency.
Pie Chart:
Average Years to Maturity** Schedule
as of 6/30/08
Over 20 Years 4%
Less than 1 Year 5%
1 - 4.99 Years 37%
5 - 9.99 Years 50%
10 - 19.99 Years 4%
** Average years to maturity is based on the average time remaining until
principal payments are expected from the Fund's bonds, weighted by dollar
amount.
ACTIVA Value Fund
Pie Chart:
Industry Sector Holdings as of 6/30/08
Information Technology 6%
Energy 21%
Materials 6%
Industrials 10%
Consumer Discretionary 6%
Consumer Staples 7%
Health Care 9%
Financials 23%
Telecommunication Services 6%
Utilities 6%
Top Ten Holdings as of 6/30/08
as a Percent of Total Investments
(The Fund's composition is subject to change)
AT&T, INC. 5.6%
EXXON MOBIL CORP. 5.5%
CONOCOPHILLIPS 5.3%
OCCIDENTAL PETROLEUM CORP. 3.4%
GENERAL ELECTRIC CO. 3.1%
ASSURANT, INC. 2.9%
GOLDMAN SACHS 2.9%
BANK OF AMERICA CORP. 2.7%
ACCENTURE LTD. 2.5%
ACE LIMITED 2.4%
8 ACTIVA Mutual Funds Semiannual Report
ACTIVA Portfolio Highlights (Unaudited) continued
ACTIVA Growth Fund
Pie Chart:
Industry Sector Holdings as of 6/30/08
Consumer Discretionary 6%
Consumer Staples 14%
Energy 12%
Financials 3%
Health Care 19%
Industrials 12%
Information Technology 23%
Materials 5%
Other 6%
Top Ten Holdings as of 6/30/08
as a Percent of Total Investments
(The Fund's composition is subject to change)
SCHLUMBERGER LTD. 4.6%
QUALCOMM, INC. 4.5%
WAL-MART STORES, INC. 3.7%
THE COCA COLA CO. 3.3%
ADOBE SYS., INC. 2.8%
APPLE COMPUTER 2.6%
DANAHER CORP. 2.6%
GOOGLE, INC. 2.6%
PHILIP MORRIS 2.6%
THERMO ELECTRON CORP. 2.3%
ACTIVA International Fund
Pie Chart:
Country Breakdown
as of 6/30/08
Japan 33%
Canada 11%
*United States 10%
United Kingdom 8%
South Africa 7%
France 7%
Republic of Korea 5%
Germany 3%
Italy 3%
Other 13%
* United States securities represent 6.1% cash equivalents and approximately
3.8% Newmont Mining Corp. which is headquartered in the United States but
has operations throughout the world in various countries.
Pie Chart:
Industry Sector Holdings as of 6/30/08
Consumer Discretionary 15%
Consumer Staples 8%
Energy 14%
Finance 3%
Health 4%
Materials and Processing 26%
Producer Durables 7%
Technology 6%
Telecommunications 13%
Other 4%
Top Ten Holdings as of 6/30/08
as a Percent of Total Investments
(The Fund's composition is subject to change)
ANGLOGOLD ASHANTI-SPN ADR - SOUTH AFRICA 4.8%
NIPPON TLGRPH. & TELE. ADR - JAPAN 4.1%
BARRICK GOLD CORP. - CANADA 4.0%
NEWMONT MINING CORP. - UNITED STATES 3.8%
PREMIERE AG - GERMANY 3.4%
DAI NIPPON PRINTING - JAPAN 3.2%
BP PLC - UNITED KINGDOM 3.1%
TELECOM ITALIA - ITALY 3.0%
NIPPON OIL CORP. - JAPAN 2.9%
FUJI PHOTO FILM - JAPAN 2.8%
ACTIVA Mutual Funds Semiannual Report 9
ACTIVA Additional Information (Unaudited)
EXPENSE EXAMPLE
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs (none for Activa Funds) and (2) ongoing costs, including management fees;
distribution 12b-1 fees; service fees; and other Fund expenses. This example is
intended to help you understand your ongoing costs (in dollars) of investing in
the Funds and to compare these costs with the ongoing costs of investing in
other mutual funds. This Example is based on an investment of $1,000 invested at
the beginning of the period and held for the entire period from January 1, 2008
to June 30, 2008.
ACTUAL EXPENSES
The first line of the table for each Fund below provides information about
actual account values and actual expenses. You may use the information in this
line, together with the amount you invested, to estimate the expenses that you
paid over the period. Simply divide your account value by $1,000 (for example,
an $8,600 account value divided by $1,000 = 8.6), then multiply the result by
the number in the first line under the heading entitled "Expenses Paid During
Period" to estimate the expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line of the table for each Fund below provides information, as
required by applicable regulations of the Securities and Exchange Commission,
about hypothetical account values and hypothetical expenses based on the Fund's
actual expense ratio and an assumed rate of return of 5% per year before
expenses, which is not the Fund's actual return. The hypothetical account values
and expenses may not be used to estimate the actual ending account balance or
expenses you paid for the period. You may use this information to compare the
ongoing costs of investing in the Fund and other funds. To do so, compare this
5% hypothetical example with the 5% hypothetical examples that appear in the
shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs such as sales
charges (loads), redemption fees, or exchange fees. Therefore, the second line
of the table is useful in comparing ongoing costs only, and will not help you
determine the relative total costs of owning different funds. Unlike some mutual
funds, the Activa Funds do not charge transactional fees such as sales charges,
redemption fees, or exchange fees.
EXPENSES PAID DURING THE PERIOD
Beginning Ending Expenses
Account Account Paid Annualized
Value, Value, During Expense
1/1/2008 6/30/2008 Period* Ratio
-------- --------- ------- -----
Activa Intermediate Bond Actual $1,000.00 $1,011.40 $5.20 1.04%
Hypothetical $1,000.00 $1,019.83 $5.24 1.04%
Activa Value Fund Class A Actual $1,000.00 $894.10 $6.45 1.37%
Hypothetical $1,000.00 $1,018.19 $6.90 1.37%
Activa Value Fund Class R Actual $1,000.00 $893.70 $5.79 1.23%
Hypothetical $1,000.00 $1,018.88 $6.19 1.23%
Activa Growth Fund Actual $1,000.00 $951.30 $6.99 1.44%
Hypothetical $1,000.00 $1,017.84 $7.25 1.44%
Activa International Fund Actual $1,000.00 $967.00 $7.73 1.58%
Hypothetical $1,000.00 $1,017.14 $7.96 1.58%
* Expenses are equal to the Fund's annualized expense ratio, multiplied by
the average account value over the period, multiplied by 182/366 (to
reflect the one-half year period).
OTHER INFORMATION
Proxy Voting Guidelines
The Funds exercise the voting rights associated with the securities held by the
Funds under the proxy voting policy of the Funds. A description of those
policies and procedures of the Fund and a record of the Fund's proxy votes for
the period ended June 30, 2008 are available without charge, upon request, by
calling 800-346-2670. It is also available on the Securities and Exchange
Commission's (SEC) website at http://www.sec.gov.
Quarterly Filing of Portfolio Holdings
The Funds will file their complete schedule of investments with the SEC for the
first and third quarters of each fiscal year on Form N-Q. The Fund's Form N-Q
will be available on the SEC's website at http://www.sec.gov. The Fund's Form
N-Q may be reviewed and copied at the SEC's Public Reference Room in Washington,
DC, and information on the operation of the Public Reference Room may be
obtained by calling 800-SEC-0330. Information included in the Fund's Forms N-Q
will also be available upon request, by calling 800-346-2670.
10 ACTIVA Mutual Funds Semiannual Report
ACTIVA Additional Information (Unaudited) continued
APPROVAL OF INVESTMENT ADVISORY AGREEMENTS
At a meeting held on February 11, 2008, the Fund's Board of Trustees approved
continuation of the Investment Advisory Contract with Activa Asset Management
LLC until March 31, 2009. At the same meeting, the Trustees approved
continuation of the Sub-Advisory Agreements for the same period.
In considering the Investment Advisory Agreement the Board of Trustees reviewed
the nature, extent and quality of the services provided to the Fund by the
Investment Adviser. As part of its review, the Board considered the performance
of the Investment Adviser in setting the overall investment strategies for the
Funds, monitoring and evaluating the investment performance of the Funds'
Sub-Advisers, and monitoring compliance with the investment objectives, policies
and restrictions of the Funds. The Board also considered the qualifications of
the portfolio managers assigned to each Fund. As part of its review, the Board
considered financial information provided by these organizations, as well as
information about their management structures, professional staffs and
compliance with securities regulations. In addition, during the year the Board
received a report from the Trust's Chief Compliance Officer regarding the
Investment Adviser's compliance programs, code of ethics, and record of
compliance with federal securities regulations. The Board concluded that the
Investment Adviser had provided satisfactory services to the Fund, and that it
could be expected to continue to provide satisfactory services in the future.
As part of its review, the Board considered information provided by the
Investment Adviser and Sub-Adviser regarding the Funds' performance, as well as
information regarding the investment performance of other funds with similar
investment objectives. The Board concluded that each Fund's investment
performance was satisfactory.
In considering the Investment Advisory Agreement the Board of Trustees also
reviewed the compensation paid under these agreements. As part of its review,
the Board considered information provided by the Investment Adviser and
Sub-Adviser with respect to the amounts being paid for investment advisory
services by other funds that have similar investment objectives. The Board also
considered the fact that the Investment Advisory Agreement provides for reduced
payments (as a percentage of Fund assets) as the size of the Fund increases, so
that Fund investors will benefit from economies of scale. The Board noted that
shareholders of the Bond and Growth Funds are currently benefiting from
economies of scale. The Board concluded that the compensation paid under the
Investment Advisory Agreement is reasonable in light of the services provided to
the Funds.
As part of its review of compensation, the Board considered other benefits that
might accrue to the Investment Adviser and its affiliated organizations by
virtue of its relationships with the Fund. The Board also considered information
provided by the Investment Adviser as to the profitability of the Investment
Advisory Agreement.
Following its review, the Board of Trustees concluded that the terms and
conditions of the Investment Advisory Agreement, including the compensation
payable thereunder, were fair and reasonable, and that the agreement should be
continued until March 31, 2009. In reaching this decision, the Board did not
identify any single factor as all-important or controlling. Nor does the
foregoing summary detail all the matters considered by the Board.
Sub-Advisory Agreement Approvals - Intermediate Bond Fund, Value Fund, Growth
Fund, and International Fund.
In considering each Sub-Advisory Agreement the Board of Trustees reviewed the
nature, extent and quality of the services provided to a Fund by its
Sub-Adviser. As part of its review, the Board considered the performance of each
Sub-Adviser in furnishing investment advice, managing the Fund's investment
portfolio, and complying with the Fund's investment objectives, policies and
restrictions. As part of its review, the Board considered financial information
provided by each of the Sub-Advisers, as well as information about their
management structures, professional staffs and, in particular, the
qualifications of the portfolio managers assigned to each Fund. In addition, the
Board received a report from the Funds' Chief Compliance Officer regarding the
ACTIVA Mutual Funds Semiannual Report 11
ACTIVA Additional Information (Unaudited) continued
Sub-Advisers' compliance programs, code of ethics, and record of compliance with
federal securities regulations. The Board concluded that each Sub-Adviser had
provided satisfactory services to the Fund, and that it could be expected to
continue to provide satisfactory services in the future.
As part of its review, the Board considered information provided by the
Investment Adviser and each of the Sub-Advisers regarding the Funds'
performance, as well as information regarding the investment performance of
other funds with similar investment objectives. In addition, the Board was
provided with a report prepared by the Consulting Group, an independent
consulting organization, which analyzed the capabilities and performance of each
of the Sub-Advisers. The Board concluded that each Fund's investment performance
was satisfactory.
In considering each Sub-Advisory Agreement the Board of Trustees also reviewed
the compensation paid under the agreement. As part of its review, the Board
considered information provided by the Investment Adviser and Sub-Adviser with
respect to the amounts being paid for investment advisory services by other
funds that have similar investment objectives. The Board also considered the
fact that each Sub-Advisory Agreement provides for reduced payments (as a
percentage of Fund assets) as the size of the Fund increases, so that Fund
investors will benefit from economies of scale. The Board noted that
shareholders of the Bond and Growth Funds are currently benefiting from
economies of scale. The Board concluded that the compensation paid under each of
the Sub-Advisory Agreements is reasonable in light of the services provided to
the Funds.
As part of its review of compensation, the Board considered other benefits that
might accrue to each Sub-Adviser and its affiliated organizations by virtue of
its relationship with the Fund including the Sub-Adviser's soft dollar practices
and, if applicable, use of affiliated brokerage. The Board did not consider a
profit analysis from each of the Sub-Advisers because the sub-advisory fees
resulted from arms-length negotiations between the Investment Adviser and each
of the Sub-Advisers and because the fees under the Sub-Advisory Agreements
constitute a very small percentage of the Sub-Advisers' total income from
providing investment management services.
Following its review, the Board of Trustees concluded that the terms and
conditions of each of the Sub-Advisory Agreements, including the compensation
payable thereunder, were fair and reasonable, and that the agreements should be
continued until March 31, 2009. In reaching this decision, the Board did not
identify any single factor as all-important or controlling. Nor does the
foregoing summary detail all of the matters considered by the Board.
12 ACTIVA Mutual Funds Semiannual Report
ACTIVA Officers and Trustees of the Fund
The business affairs of the Fund are managed under the direction of the Board of
Trustees ("Board"). The following information as of June 30, 2008 pertains to
the Officers and Trustees of the Fund or the Adviser or both, and includes their
principal occupation during the past five years and, for the Trustees, their
compensation as Trustees:
NUMBER OF
PORTFOLIOS OTHER
IN FUND DIRECTOR-
TERM OF COMPLEX SHIPS
NAME AND OFFICE/YEARS PRINCIPAL OCCUPATION OVERSEEN BY HELD BY
ADDRESS AGE OFFICE HELD SERVED LAST FIVE YEARS TRUSTEE TRUSTEE
INTERESTED TRUSTEE
James J. Rosloniec* 63 Trustee of the Fund Perpetual / 27 President, Chief Operating Officer, 4 None
2905 Lucerne SE, JVA Enterprises I, LLC; President,
Suite 200 Chief Executive Officer and Director,
Grand Rapids, Michigan Activa Holdings Corp.; President,
49546 Chief Executive Officer, of Activa
Management Services, LLC; and
President and Treasurer, Activa
Mutual Fund Trust (1999-2002).
ADVISORY TRUSTEE
Joseph E. Victor, Jr. 60 Advisory Trustee of Perpetual / 7 President and Chief Executive Officer, 4 None
2905 Lucerne SE, the Fund Marker Net, Inc. (Crown Independent
Suite 200 Business Owner affiliated with
Grand Rapids, Michigan Quixtar, Inc.)
49546
DISINTERESTED TRUSTEES
Donald H. Johnson 77 Trustee of the Fund Perpetual / 15 Retired, Former Vice President- 4 None
2905 Lucerne SE, Treasurer, SPX Corporation.
Suite 200
Grand Rapids, Michigan
49546
Walter T. Jones 66 Trustee of the Fund Perpetual / 16 Retired, Former Senior Vice 4 None
936 Sycamore Drive President-Chief Financial Officer,
Holland, Michigan Prince Corporation
49424
Richard E. Wayman 73 Trustee of the Fund Perpetual / 10 Retired, Former Finance Director, 4 None
24578 Rutherford Amway Corporation.
Ramona, California
92065
OFFICER
Allan D. Engel 56 President, Secretary Perpetual / 27 Vice President, Real Estate N/A N/A
2905 Lucerne SE, and Treasurer of the Operations and Secretary-Activa
Suite 200 Fund; President, and Holdings Corp.; Vice President of
Grand Rapids, Michigan Secretary of the Activa Management Services, LLC;
49546 Investment Adviser. Trustee, Activa Mutual Fund Trust
(1999-2004); and Vice President
and Assistant Treasurer, Activa
Mutual Fund Trust (1999-2002).
ACTIVA Mutual Funds Semiannual Report 13
ACTIVA Officers and Trustees of the Fund continued
The following table contains information about the compensation that the
Trustees received during the six month period ended June 30, 2008:
PENSION OR
RETIREMENT
BENEFITS
ACCRUED AS ESTIMATED ANNUAL TOTAL
NAME OF PERSON, TRUSTEE PART OF BENEFITS COMPENSATION
POSITION COMPENSATION FUND EXPENSES UPON RETIREMENT PAID TO TRUSTEES
INTERESTED TRUSTEE
James J. Rosloniec* $8,000 -0- -0- $8,000
Trustee
ADVISORY TRUSTEE
Joseph E. Victor, Jr. $8,000 -0- -0- $8,000
Advisory Trustee
DISINTERESTED TRUSTEES
Donald H. Johnson $8,000 -0- -0- $8,000
Trustee
Walter T. Jones $8,000 -0- -0- $8,000
Trustee
Richard E. Wayman $8,000 -0- -0- $8,000
Trustee
*Mr. Rosloniec is an interested person of the Funds inasmuch as he is an officer
of Activa Holdings Corp. and Activa Management Services, LLC, which controls the
Investment Adviser. He is also an officer of JVA Enterprises I, LLC , which may
be deemed to control Activa Holdings Corp.
Fees paid to all Trustees during the six month period ended June 30, 2008,
amounted to $40,000. Under the Administrative Agreement, the Investment Adviser
pays the fees of the Interested Trustees of the Funds and the Funds pay the fees
of the Disinterested and Advisory Trustees of the Funds. In addition, the
Investment Adviser pays the salaries and fees of all of the Funds' officers who
devote all or part of their time to the affairs of the Investment Adviser.
The Funds' Statement of Additional Information contains additional information
about the Funds' Trustees. It is available, without charge, by writing or
telephoning the Funds.
14 ACTIVA Mutual Funds Semiannual Report
ACTIVA Schedule of Investments
INTERMEDIATE BOND FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS - TAXABLE
CUSTODIAN CASH SWEEP 1.5%
NORTHERN INSTITUTIONAL DIVERSIFIED ASSETS PORT. 997,826 $ 997,826
-----------
US TREASURY NOTES 3.4%
U.S. TREASURY NOTES, 6.25%, 8/15/23 1,355,000 1,612,558
U.S. TREASURY NOTES, 4.25%, 8/15/14 600,000 627,048
-----------
2,239,606
-----------
US TREASURY BONDS 4.1%
US TREASURY INFLATION INDEX BOND (TIP), 3.875%, 4/15/29 366,000 618,521
U.S. TREASURY INFLATION INDEX BOND (TIP), 2.00%, 1/15/14 1,000,000 1,228,442
U.S. TREASURY NOTE, 4.625%, 2/15/17 800,000 842,501
-----------
2,689,464
-----------
US TREASURY STRIPS - PRINCIPAL ONLY 1.5%
STRIP PRINC., 11/15/13 135,000 111,865
STRIP PRINC., 8/15/25 1,900,000 846,241
-----------
958,106
-----------
FEDERAL HOME LOAN BANK 1.5%
FEDERAL HOME LOAN BANK, DN, 7/2/08 1,000,000 999,879
-----------
FEDERAL HOME LOAN MORTGAGE 15.5%
FEDERAL GOVERNMENT LOAN MGMT. CORP., 5.50%, 12/1/32 234,807 232,826
FEDERAL GOVERNMENT LOAN MGMT. CORP., 5.00%, 12/01/35 625,562 601,627
FEDERAL GOVERNMENT LOAN MGMT. CORP., 5.50%, 8/1/37 931,921 919,107
FEDERAL GOVERNMENT LOAN MGMT. CORP., 5.50%, 2/01/36 453,321 447,938
FEDERAL GOVERNMENT LOAN MGMT. CORP., 4.50%, 12/01/35 425,057 394,780
FEDERAL GOVERNMENT LOAN MGMT. CORP., 5.50%, 9/01/19 334,600 338,995
FEDERAL GOVERNMENT LOAN MGMT. CORP., 5.375%, 1/09/14 720,000 726,044
FEDERAL GOVERNMENT LOAN MGMT. CORP., 8.00%, 3/1/30 93,875 101,717
FEDERAL GOVERNMENT LOAN MGMT. CORP., 4.50%, 4/01/20 791,459 770,040
FEDERAL GOVERNMENT LOAN MGMT. CORP., 5.00%, 7/01/34 733,092 706,188
FEDERAL GOVERNMENT LOAN MGMT. CORP., 5.50%, 5/01/35 1,220,082 1,205,594
FEDERAL GOVERNMENT LOAN MGMT. CORP., 5.00%, 9/01/35 988,918 951,081
FEDERAL GOVERNMENT LOAN MGMT. CORP., 5.50%, 5/15/28 1,021,000 1,045,231
FEDERAL GOVERNMENT LOAN MGMT. CORP., 5.00%, 4/15/18 767,000 768,978
FEDERAL GOVERNMENT LOAN MGMT. CORP., 4.50%, 4/15/26 852,000 858,188
-----------
10,068,334
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION 20.4%
FANNIE MAE, 6.5%, 9/1/29 42,607 44,317
FANNIE MAE, 4.50%, 9/1/18 666,505 652,009
FANNIE MAE, 5.00%, 12/1/33 539,045 520,104
FANNIE MAE, 5.00%, 7/1/37 1,204,172 1,155,585
FANNIE MAE, 6.0%, 1/1/29 70,095 71,396
FANNIE MAE, 6.50%, 3/1/29 46,322 48,210
ACTIVA Mutual Funds Semiannual Report 15
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERMEDIATE BOND FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (CONTINUED)
FANNIE MAE, 6.50%, 3/1/29 41,462 $ 43,152
FANNIE MAE, 6.50%, 7/1/32 457,001 474,486
FANNIE MAE, 6.50%, 4/1/18 276,730 288,816
FANNIE MAE, 6.50%, 5/1/32 222,686 231,206
FANNIE MAE, 3.25%, 4/9/13 650,000 626,158
FANNIE MAE, 5.5%, 2/1/33 213,005 211,237
FANNIE MAE, 5.50%, 4/1/33 173,487 172,047
FANNIE MAE, 4.50%, 8/1/19 665,361 649,226
FANNIE MAE, 5.00%, 8/1/33 180,557 174,213
FANNIE MAE, 7.00%, 3/1/35 112,876 119,245
FANNIE MAE, 5.00%, 6/01/34 194,653 187,570
FANNIE MAE, 5.00%, 8/01/19 380,621 379,249
FANNIE MAE, 6.00%, 10/1/34 909,387 921,163
FANNIE MAE, 4.50%, 9/01/35 1,110,962 1,031,329
FANNIE MAE, 6.00%, 1/01/36 1,442,303 1,458,726
FANNIE MAE, 5.00%, 11/01/35 516,534 496,932
FANNIE MAE, 5.50%, 1/01/36 869,428 859,765
FANNIE MAE, 5.50%, 2/01/36 732,672 724,530
FANNIE MAE, 5.260%, 4/01/37 1,179,389 1,194,462
FANNIE MAE, 5.50%, 11/01/36 509,160 502,548
-----------
13,237,681
-----------
FEDERAL FARM CREDIT BANK 0.8%
FEDERAL FARM CREDIT BANK, 4.875%, 1/17/17 500,000 508,270
-----------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION 3.4%
GOVERNMENT NATIONAL MORTGAGE ASSOC., 7.00%, 11/15/31 67,058 71,405
GOVERNMENT NATIONAL MORTGAGE ASSOC., 7.00%, 12/15/28 26,945 28,740
GOVERNMENT NATIONAL MORTGAGE ASSOC., 7.00%, 9/15/29 7,063 7,530
GOVERNMENT NATIONAL SINGLE FAMILY, 7.00%, 12/15/29 102,799 109,621
GOVERNMENT NATIONAL MORTGAGE ASSOC., 4.50%, 4/15/18 377,976 371,410
GOVERNMENT NATIONAL SINGLE FAMILY, 7.00%, 9/15/34 71,899 76,359
GOVERNMENT NATIONAL MORTGAGE ASSOC., 3.407%, 7/16/21 582,389 576,261
GOVERNMENT NATIONAL MORTGAGE ASSOC., 4.549%, 6/16/28 1,000,000 978,128
-----------
2,219,454
-----------
FOREIGN BOND 7.7%
GOVERNMENT OF CANADA, 4.00%, 6/1/16 100,000 100,338
CANADA GOV'T., 4.25%, 12/01/08 350,000 345,169
PROVINCE OF ONTARIO, 4.30%, 3/08/17 400,000 390,657
TELEFONICA EMISIONES SAU., 5.855%, 2/04/13 280,000 282,151
JAPAN-37(10 YEAR ISSUE) GOVT., 0.80%, 6/20/09 53,950,000 508,388
GOVERNMENT OF AUSTRALIA, 5.25%, 8/15/10 1,000,000 929,085
BUNDESREPUB. DEUTSCHLAND, 4.0%, 1/04/37 200,000 272,496
UK TREASURY NOTE, 4.00%, 9/07/16 200,000 368,886
BUONI POLIENNALI DEL TES, 3.75%, 8/01/16 370,000 533,443
JAPAN-281(10 YEAR ISSUE), 2.00%, 6/20/16 127,450,000 1,245,403
-----------
4,976,016
-----------
16 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERMEDIATE BOND FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS
NEW YORK 0.9%
PORT AUTHORITY NY AND NJ MUN. BOND, 5.75%, 11/01/32 600,000 $ 601,440
-----------
CORPORATE BONDS - 23.4%
AUTOMOTIVE 1.3%
CREDIT SUISSE NEW YORK, 5.75%, 2/15/18 290,000 279,747
DAIMLERCHRYSLER, 5.75%, 9/08/11 295,000 301,042
DELHAIZE AMERICA, INC., 6.50%, 6/15/17 250,000 252,605
-----------
833,394
-----------
BANKING 2.8%
BB&T CAPITAL TRUST, 6.75%, 6/07/36 285,000 250,327
CITIGROUP, INC., 5.625%, 8/27/12 280,000 275,718
FIFTH THIRD BANCORP, 5.45%, 1/15/17 295,000 237,675
JP MORGAN CHASE, 5.375%, 10/01/12 280,000 281,106
JP MORGAN CHASE, 5.247%, 1/12/43 500,000 499,864
WELLS FARGO COMPANY, 5.25%, 10/23/12 280,000 281,838
-----------
1,826,528
-----------
BROADCASTING 0.4%
ROGERS CABLE, INC., 5.50%, 3/15/14 270,000 260,223
-----------
DRUGS 1.3%
ABBOTT LABS, 5.60%, 11/30/17 280,000 282,941
DOVER CORP. 5.45%, 3/15/18 300,000 294,333
HOSPIRA, INC., 6.05%, 3/30/17 300,000 290,003
-----------
867,277
-----------
ELECTRIC UTILITY 4.1%
DPL, INC., 6.875%, 9/01/11 270,000 281,318
MIDAMERICA ENERGY HLDGS., 6.125%, 4/01/36 295,000 284,200
NEVADA POWER CO., 5.875%, 1/15/15 306,000 306,981
NUCOR CORP., 5.75% 12/01/17 285,000 285,907
PECO ENERGY TRANSITION TRUST, 6.52%, 12/31/10 1,152,000 1,207,549
TEXTRO, INC., 4.50%, 8/01/10 285,000 284,760
-----------
2,650,715
-----------
ENERGY 2.1%
FLORIDA POWER CORP., 6.35%, 9/15/37 170,000 173,216
NORTHERN STATES PWR., 8.00%, 8/28/12 250,000 279,699
SOUTHERN POWER CO., 6.25%, 7/15/12 280,000 292,003
SUNCORP ENERGY, INC., 6.10%, 6/01/18 300,000 301,464
XTO ENERGY, INC., 5.5%, 6/15/18 300,000 287,033
-----------
1,333,415
-----------
ACTIVA Mutual Funds Semiannual Report 17
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERMEDIATE BOND FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
FINANCIAL SERVICES 4.4%
AMERICA MOVIL SA AMXLMM5, 5.625%, 11/15/17 320,000 $ 309,790
AMERICAN EXPRESS, 6.80%, 9/01/66 270,000 250,006
CITIGROUP/DEUTSCHE BANK COMM. MORTAGE, VRN, 7/15/44 605,000 605,398
CASE CORP., 7.250%, 1/15/16 290,000 284,200
GENERAL ELECTRIC CAPITAL CORP., 5.0875%, 1/14/38 300,000 272,780
GOLDMAN SACHS GROUP, INC., 5.625%, 1/15/17 360,000 334,111
INTERNATIONAL LEASE FIN., 5.625%, 9/20/13 305,000 266,950
MORGAN STANLEY CAPITAL, 4.517%, 1/14/42 1,311 1,310
PNC FUNDING CORP., 5.125%, 12/14/10 295,000 293,319
RESONA PFD GLOBAL SECS., 7.191%, 12/29/49 290,000 268,141
-----------
2,886,005
-----------
HEALTH CARE 0.9%
AETNA, INC., 5.75%, 6/15/11 290,000 300,155
UNUMPROVIDENT CORP., 7.625%, 3/01/11 270,000 280,537
-----------
580,692
-----------
INSURANCE 0.8%
ACE INA HOLDINGS, 5.70%, 2/15/17 290,000 278,862
METLIFE, INC., 6.40%, 12/15/36 285,000 249,590
-----------
528,452
-----------
OIL & EXPLOR PROD & SER 0.4%
PETROBAS INTERNATIONAL, 6.125%, 10/06/16 280,000 281,400
-----------
OIL & GAS EQUIPMENT/SERVICES 2.3%
HESS CORP., 6.65%, 8/15/11 270,000 283,389
CONOCOPHILLIPS, 5.20%, 5/15/18 300,000 296,220
FPL GROUP CAPITAL, INC., 7.375%, 6/01/09 275,000 284,349
ORACLE CORP., 5.75%, 4/15/18 345,000 345,344
WESTERN OIL AND SANDS, INC., 8.375%, 5/01/12 285,000 310,311
-----------
1,519,613
-----------
PIPELINES 0.4%
KINDER MORGAN ENERGY PARTNERS, 5.85%, 9/15/12 280,000 282,613
-----------
PRINTING & PUBLISHING 0.8%
NEWS AMERICA HOLDINGS, 8.15%, 10/17/36 152,000 170,218
XEROX CORP., 5.50%, 5/15/12 320,000 316,573
-----------
486,791
-----------
TECHNOLOGY 0.4%
SEAGATE TECHNOLOGY HDD, 6.80%, 10/01/16 305,000 279,837
-----------
TRANSPORTATION & SHIPPING 0.5%
UNITED PARCEL SERVICES, 5.50%, 1/15/18 285,000 289,110
-----------
18 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERMEDIATE BOND FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
TELECOMMUNICATIONS 0.5%
VERIZON NEW YORK, INC., 6.875%, 4/01/12 315,000 $ 328,782
-----------
TOTAL CORPORATE BONDS 15,234,847
-----------
ASSET BACKED SECURITIES - 3.8%
ELECTRIC UTILITY 1.1%
DETROIT EDISON SECURITIZATION FUNDING LLC, 6.19%, 3/1/13 169,000 174,718
PSE&G TRANSITION FUNDING LLC, 6.45%, 3/15/13 494,000 516,220
-----------
690,938
-----------
FINANCIAL SERVICES 2.7%
CARMAX AUTO OWNER TRUST, 4.79%, 2/15/13 550,000 544,418
CITIBANK CREDIT CARD INSURANCE TRUST, 5.30%, 3/15/18 625,000 613,701
HONDA AUTO RECEIVABLES OWNER TRUST, 5.11%, 4/15/12 595,000 604,395
-----------
1,762,514
-----------
TOTAL ASSET BACKED SECURITIES 2,453,452
-----------
COLLATERALIZED MORTGAGE OBLIGATIONS - 12.1%
FINANCIAL SERVICES 12.1%
BEAR STEARNS COMMERCIAL MORTG. SEC., 4.735%, 9/11/42 500,000 495,576
BEAR STEARNS COMMERCIAL MORTG. SEC., 5.426%, 9/11/41 605,000 599,877
BEAR STEARNS COMMERCIAL MORTG. SEC., 5.201%, 12/11/38 945,000 883,273
BEAR STEARNS COMMERCIAL MORTG. SEC., 5.588%, 9/11/42 650,000 636,130
CATERPILLAR FIN SERV., 5.45%, 4/15/18 335,000 332,731
CITIGROUP/DEUTS. BANK COMM. MORTG. TR., 5.56%, 10/15/48 740,000 735,167
GREENWICH CAPITAL COMM. FUNDING CORP., 5.381%, 3/10/39 605,000 592,409
FREDDIE MAC, 5.00%, 10/15/31 1,500,000 1,488,139
FREDDIE MAC, 5.50%, 1/15/31 1,128,000 1,143,733
MERRILL LYNCH MORTGAGE TRUST, VRN, 11/12/37 500,000 483,438
SMALL BUSINESS ADMIN. PARTICIPATION, 6.07%, 7/01/26 460,552 477,796
-----------
7,868,269
-----------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS 7,868,269
-----------
TOTAL FIXED INCOME - 100% (Cost $65,005,007) $65,052,644
===========
ACTIVA Mutual Funds Semiannual Report 19
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments
VALUE FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS - TAXABLE - 2.0% 2.0%
CUSTODIAN CASH SWEEP
NORTHERN INSTITUTIONAL DIVERSIFIED ASSETS PORT. 1,630,948 $ 1,630,948
-----------
TOTAL MONEY MARKET FUNDS - TAXABLE (Cost $1,630,948) 1,630,948
-----------
COMMON STOCKS - 98.0%
AEROSPACE 1.9%
HONEYWELL INTERNATIONAL, INC. 6,500 326,820
INGRAM MICRO, INC. CL A *18,300 324,825
LOCKHEED MARTIN CORP. 7,100 700,486
RAYTHEON CO. 4,400 247,632
-----------
1,599,763
-----------
AGRICULTURE 0.4%
BUNGE LIMITED 3,200 344,608
-----------
AUTOMOTIVE PARTS & EQUIPMENT 0.6%
TRW AUTOMOTIVE HOLDINGS CORP. *28,800 531,936
-----------
BANKING 4.0%
CITIGROUP, INC. 24,172 405,123
COMERICA, INC. 11,960 306,535
HUNTINGTON BANCSHARES, INC. 24,100 139,057
POPULAR, INC. *55,300 364,427
SOVEREIGN BANCORP, INC. *21,770 160,227
TORONTO DOMINION BANK - ADR 3,246 202,128
UMB FINANCIAL CORP. *13,500 692,145
U.S. BANCORP 37,300 1,040,297
-----------
3,309,939
-----------
BUSINESS SERVICES 2.3%
LEXMARK INTERNATIONAL, INC. *6,500 217,295
MANPOWER, INC. 22,900 1,333,696
WESTERN UNION CORP. *15,900 393,048
-----------
1,944,039
-----------
CHEMICALS 1.3%
MOSAIC CO/THE 7,700 1,114,190
-----------
CONSTRUCTION - FOREIGN 2.5%
ACCENTURE LTD. 50,500 2,056,360
-----------
CONSUMER GOODS & SERVICES 0.4%
HASBRO, INC. 8,600 307,192
-----------
20 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
VALUE FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
CONTAINERS & PACKAGING 0.9%
GREIF, INC. 3,700 $ 236,911
OWENS-ILLINOIS, INC. 11,800 491,942
-----------
728,853
-----------
COSMETICS 0.3%
KIMBERLY-CLARK CORP. *4,000 239,120
-----------
DIVERSIFIED 3.1%
GENERAL ELECTRIC & CO. 95,800 2,556,902
-----------
ELECTRIC UTILITY 0.9%
FIRSTENERGY CORP. 9,200 757,436
-----------
ENERGY 5.2%
AMERICAN ELECTRIC POWER 10,600 426,438
DEVON ENERGY CORP. 5,000 600,800
DOMINION RESOURCES, INC./VA 7,200 341,928
DUKE ENERGY CORP. 56,100 975,018
NOBLE ENERGY, INC. *3,100 311,736
SIERRA PACIFIC RESOURCES 22,300 283,433
UGI CORPORATION 47,800 1,372,338
-----------
4,311,691
-----------
ENTERTAINMENT 1.7%
WALT DISNEY COMPANY 44,300 1,382,160
-----------
FINANCIAL SERVICES 10.6%
BANK OF AMERICA CORP. 95,512 2,279,871
BANK OF NEW YORK MELLON CORP. 11,400 431,262
CAPITAL ONE FINANCIAL 16,800 638,568
CAPITALSOURCE, INC. 34,700 384,476
GOLDMAN SACH GROUP, INC. 13,800 2,413,620
LEHMAN BROTHERS HOLDING 30,700 608,167
STATE STREET CORP. *16,900 1,081,431
UNUM GROUP 31,100 635,995
WADDELL & REED FINANCIAL 10,000 350,100
-----------
8,823,490
-----------
FOOD PRODUCTS 0.7%
KROGER CO. 19,500 562,965
-----------
HEALTH CARE 3.0%
MCKESSON HBOC, INC. 33,500 1,872,985
UNIVERSAL HEALTH SERVICES, INC. 9,200 581,624
-----------
2,454,609
-----------
ACTIVA Mutual Funds Semiannual Report 21
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
VALUE FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
HOTELS & LODGING 0.6%
HOST HOTELS & RESORTS 36,500 $ 498,225
-----------
INSURANCE 7.2%
AMERICAN INTERNATIONAL GROUP 29,200 772,632
ASSURANT, INC. 35,900 2,367,964
ACE LIMITED 35,600 1,961,204
EVEREST RE GROUP LTD. 11,400 908,694
-----------
6,010,494
-----------
MACHINERY & EQUIPMENT 1.2%
AGCO CORPORATION *18,500 969,585
-----------
MANUFACTURING - MISCELLANEOUS 1.2%
PARKER HANNIFIN CORP. 13,900 991,348
-----------
MEDICAL SERVICES 0.9%
AMGEN, INC. *15,400 726,264
-----------
METALS & MINING 2.2%
ALCOA, INC. *14,700 523,614
FREEPORT-MCMORAN COPPER 9,700 1,136,743
SOUTHERN COPPER CORP. 1,800 191,934
-----------
1,852,291
-----------
OFFICE/BUSINESS EQUIPMENT & SUPPLIES 1.8%
HEWLETT-PACKARD 23,500 1,038,935
INTERNATIONAL BUSINESS MACHINES CORP. 3,700 438,561
-----------
1,477,496
-----------
OIL & GAS EXPLOR PROD & SER 19.1%
CHEVRON CORPORATION 7,419 735,446
CONOCOPHILLIPS 46,600 4,398,574
CONTINENTAL RESOURCES, INC. *4,300 298,076
EXXON MOBIL CORP. 52,164 4,597,213
HESS CORP. 10,700 1,350,233
MARATHON OIL CORP. 27,000 1,400,490
OCCIDENTAL PETROLEUM CORP. 31,300 2,812,618
W&T OFFSHORE, INC. *4,500 263,295
-----------
15,855,945
-----------
PHARMACEUTICALS 5.4%
BRISTOL-MYERS SQUIBB COMPANY 29,300 601,529
ELI LILLY & CO. 29,700 1,370,952
MERCK & COMPANY, INC. 20,800 783,952
22 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
VALUE FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
PHARMACEUTICALS (CONTINUED)
UNITEDHEALTH GROUP, INC. *13,000 $ 341,250
WATSON PHARMACEUTICALS, INC. *10,900 296,153
WYETH *22,500 1,079,100
-----------
4,472,936
-----------
RESTAURANTS 0.7%
DARDEN RESTAURANT, INC. 17,600 562,144
-----------
RETAIL STORES 5.7%
BJ'S WHOLESALE CLUB, INC. *15,800 611,460
DOLLAR TREE, INC. *7,900 258,251
GAP, INC. 86,800 1,446,956
STAPLES, INC. *9,200 218,500
SUPERVALU, INC. 33,200 1,025,548
WAL-MART STORES, INC. 21,200 1,191,440
-----------
4,752,155
-----------
REAL ESTATE INVESTMENT TRUST 0.6%
DOVER CORPORATION 9,500 459,515
-----------
STEEL 1.2%
UNITED STATES STEEL CORP. 5,400 997,812
-----------
TECHNOLOGY 0.9%
AVNET, INC. 7,200 196,416
BELDEN CDT, INC. 5,700 193,116
SEAGATE TECHNOLOGY *21,400 409,382
-----------
798,914
-----------
TOBACCO 1.9%
PHILIP MORRIS INTERNATIONAL *32,325 1,596,532
-----------
TELECOMMUNICATIONS 7.6%
AT&T, INC. 139,045 4,684,426
ENTERGY CORP. 3,100 373,488
FPL GROUP, INC. 11,400 747,612
TIME WARNER 36,900 546,120
-----------
6,351,646
-----------
TOTAL COMMON STOCKS (Cost $78,215,004) 81,398,555
-----------
TOTAL INVESTMENTS - 100% (Cost $79,845,952) $83,029,503
===========
*Non-dividend producing as of June 30, 2008
ACTIVA Mutual Funds Semiannual Report 23
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments
GROWTH FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS - TAXABLE - 0.3% 0.3%
CUSTODIAN CASH SWEEP
NORTHERN INSTITUTIONAL DIVERSIFIED ASSETS PORT. 69,285 $ 69,285
-----------
TOTAL MONEY MARKET FUNDS - TAXABLE (Cost $69,285) 69,285
-----------
FEDERAL HOME LOAN BANK - 0.7% 0.7%
FEDERAL HOME LOAN BANK, 7/01/08 200,000 200,000
-----------
TOTAL FEDERAL HOME LOAN BANK (Cost $200,000) 200,000
-----------
COMMON STOCKS - 97.2%
AEROSPACE 2.7%
HONEYWELL INTERNATIONAL, INC. 9,219 463,531
NORTHROP GRUMMAN CORP. 4,500 301,050
-----------
764,581
-----------
AGRICULTURE 1.6%
MONSANTO COMPANY 3,484 440,517
-----------
AIRLINES 1.1%
EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. 6,976 299,968
-----------
BIOTECHNOLOGY 6.1%
CELGENE CORP. *7,300 466,251
GENENTECH, INC. *4,900 371,910
GENZYME CORPORATION *4,400 316,888
GILAD SCIENCES, INC. 10,400 550,680
-----------
1,705,729
-----------
BUSINESS SERVICES 2.4%
JANUS CAPITAL GROUP, INC. 19,404 513,624
RESEARCH IN MOTION 1,310 153,139
-----------
666,763
-----------
COAL & CONSUMABLE FUELS 1.5%
CONSOL ENERGY, INC. 3,792 426,107
-----------
COMMUNICATIONS EQUIPMENT 8.8%
AMERICAN TOWER CORPORATION *13,838 584,655
CISCO SYSTEMS, INC. *27,030 628,718
QUALCOMM, INC. 28,196 1,251,057
-----------
2,464,430
-----------
24 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
GROWTH FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
COMPUTER SOFTWARE 4.5%
ADOBE SYSTEMS, INC. *19,959 $ 786,185
MICROSOFT CORP. 17,276 475,263
-----------
1,261,448
-----------
COMPUTER HARDWARE 2.6%
APPLE COMPUTER *4,407 737,908
-----------
CONSUMER GOODS & SERVICES 5.0%
COCA-COLA CO. 17,500 909,650
MCDONALD'S CORP. 4,700 264,234
PEPSICO, INC. 3,700 235,283
-----------
1,409,167
-----------
COSMETICS 3.7%
ACTIVISION, INC. *18,100 616,667
AVON PRODUCTS, INC. 11,300 407,026
-----------
1,023,693
-----------
ELECTRIC UTILITY 1.7%
EXELON CORP. 5,123 460,865
-----------
ELECTRONICS 1.3%
PMC - SIERRA, INC. 48,700 372,555
-----------
FINANCIAL SERVICES 1.3%
JP MORGAN CHASE & CO. 4,900 168,119
NYSE EURONEXT 3,700 187,442
-----------
355,561
-----------
GOLD (PRECIOUS METALS) 1.7%
AGNICO-EAGLE MINES LTD. *6,200 461,094
-----------
HEALTH CARE 2.4%
DENTSPLY INT'L., INC. *5,200 191,360
MEDCO HEALTH SOLUTIONS *9,916 468,035
-----------
659,395
-----------
INDUSTRIAL GOODS & SERVICES 2.0%
CORNING, INC. 16,073 370,483
FLUOR CORP. 1,000 186,080
-----------
556,563
-----------
INSTRUMENTATION 2.3%
THERMO ELECTRON CORP. *11,500 640,895
-----------
ACTIVA Mutual Funds Semiannual Report 25
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
GROWTH FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
INTERNET CONTENT 2.6%
GOOGLE, INC. CL A *1,379 $ 725,933
-----------
INVESTMENT COMPANY 1.8%
JOY GLOBAL, INC. 6,500 492,895
-----------
MACHINERY & EQUIPMENT 0.8%
BORGWARNER, INC. *5,000 221,900
-----------
MANUFACTURING-CAPITAL GOODS 2.6%
DANAHER CORP. 9,400 726,620
-----------
MEDICAL EQUIPMENT & SUPPLIES 4.3%
C.R. BARD, INC. 2,800 246,260
JOHNSON & JOHNSON 9,500 611,230
HENRY SCHEIN, INC. *6,600 340,362
-----------
1,197,852
-----------
METALS & MINING 1.9%
FREEPORT-MCMORAN COPPER 4,659 545,988
-----------
NATURAL RESOURCES 1.1%
MASSEY ENERGY CO. *3,270 306,562
-----------
OIL & GAS EXPLOR PROD & SER 9.5%
CAMERON INTERNATIONAL CORP. *10,500 581,175
EOG RESOURCES, INC. 2,530 331,936
PETROLEO BRASILEIRO S.A 3,200 226,656
SCHLUMBERGER LTD. 12,074 1,297,110
TRANSOCEAN, INC. *1,397 212,889
-----------
2,649,766
-----------
PHARMACEUTICALS 5.1%
ABBOTT LABORATORIES 10,100 534,997
CUMMINS, INC. 7,100 465,192
ELAN CORP. PLC - SPONS. ADR *11,900 423,045
-----------
1,423,234
-----------
RETAIL STORES 7.9%
AMAZON.COM, INC. 4,242 311,066
CVS CORP. *2,100 83,097
KOHL'S CORP. *7,434 297,657
NORDSTROM, INC. 6,890 208,767
ROSS STORES, INC. *7,530 267,466
WAL-MART STORES, INC. 18,474 1,038,239
-----------
2,206,292
-----------
26 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
GROWTH FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
TECHNOLOGY-SOFTWARE 1.6%
SALESFORCE.COM, INC. *6,490 $ 442,813
-----------
TOBACCO 2.6%
PHILIP MORRIS INTERNATIONAL *14,919 736,849
-----------
TELECOMMUNICATIONS 1.7%
AT&T, INC. 7,426 250,182
BROADCOM CORP. CL A 8,600 234,694
-----------
484,876
-----------
WASTE MANAGEMENT 1.0%
WASTE MANAGEMENT, INC. 7,800 294,138
-----------
TOTAL COMMON STOCKS - (Cost $25,236,768) 27,162,957
-----------
WARRANTS - 0.0% 0.0%
RAYTHEON CO. WARRANTS, EXPIRES 6/16/11 628 12,214
-----------
TOTAL WARRANTS - (Cost $0.00) 12,214
-----------
MUTUAL FUNDS - 1.8% 1.8%
FINANCIAL SERVICES
CONSUMER STAPLES SELECT SECTOR SPDR FUND 18,400 490,544
-----------
TOTAL MUTUAL FUNDS (Cost $482,025) 490,544
-----------
TOTAL INVESTMENTS - 100% (Cost $25,988,078) $27,935,000
===========
*Non-dividend producing as of June 30, 2008
ACTIVA Mutual Funds Semiannual Report 27
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments
INTERNATIONAL FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS - TAXABLE - 6.1% 6.1%
CUSTODIAN CASH SWEEP - UNITED STATES
NORTHERN INSTITUTIONAL DIVERSIFIED ASSETS PORT. 2,790,626 $ 2,790,626
-----------
TOTAL MONEY MARKET FUNDS - TAXABLE (Cost $2,790,626) 2,790,626
-----------
COMMON STOCKS - 93.9% 1.9%
AEROSPACE
THALES SA - FRANCE 15,050 857,698
-----------
ALUMINUM 3.1%
TOYO SEIKAN KAISHA LTD. - JAPAN 32,800 578,951
ALUMINA LTD. - AUSTRALIA 183,290 832,649
-----------
1,411,600
-----------
APPAREL 1.2%
WACOAL HOLDINGS CORP. - JAPAN 45,000 537,440
-----------
AUTOMOTIVE PARTS & EQUIPMENT 1.4%
MAGNA INTERNATIONAL, INC. CL A - CANADA *10,430 617,873
-----------
BANKING 0.9%
SUMITOMO TRUST & BANKING - JAPAN 61,000 426,316
-----------
BEVERAGES - FOREIGN 2.2%
COCA-COLA WEST HOLDINGS CO., LTD. - JAPAN 43,100 1,004,733
-----------
BREWERY 1.8%
KIRIN BREWERY CO., LTD. - JAPAN 53,000 827,673
-----------
BUILDING PRODUCTS 1.3%
JS GROUP CORP. - JAPAN 38,500 611,750
-----------
CABLE TV 3.4%
PREMIERE AG - GERMANY *69,400 1,529,597
-----------
COMPUTER STORAGE 2.8%
GEMALTO - NETHERLANDS *35,150 1,279,389
-----------
CONSUMER GOODS & SERVICES 6.7%
FUJI PHOTO FILM - JAPAN 36,900 1,268,579
MABUCHI MOTOR CO. LTD. - JAPAN *23,000 1,247,810
SEGA SAMMY HOLDINGS, INC. - JAPAN 63,100 550,349
-----------
3,066,738
-----------
COSMETICS 1.5%
SHISEIDO CORP. - JAPAN 30,000 686,635
-----------
28 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERNATIONAL FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
ELECTRIC UTILITY 2.2%
CENTRAIS ELETRICAS BRASILEIRAS S.A. - BRAZIL 28,950 $ 476,340
KOREA ELECTRIC POWER CORP. - SPON. ADR - KOREA 36,000 523,080
-----------
999,420
-----------
ENERGY 1.1%
SUNCOR ENERGY, INC. - CANADA 8,440 490,533
-----------
FINANCIAL SERVICES 2.2%
TAKEFUJI CORP. - JAPAN 35,920 499,707
UBS AG-REG - SWITZERLAND 24,801 512,391
-----------
1,012,098
-----------
FOREST PRODUCTS 1.5%
STORA ENSO OYJ `R' SHRS - FINLAND 71,050 666,653
-----------
FOREIGN AGENCIES 1.1%
OPTI CANADA, INC. - CANADA *22,830 517,337
-----------
GOLD (PRECIOUS METALS) 9.7%
ANGLOGOLD ASHANTI-SPON ADR - SOUTH AFRICA 64,812 2,199,719
GOLD FIELDS LTD.-SPONS ADR - SOUTH AFRICA 25,150 318,148
GOLD FIELDS LTD. - SOUTH AFRICA 60,220 766,226
LIHIR GOLD LTD. - PAPUA NEW GUINEA *169,220 533,571
NEWCREST MINING LTD. - AUSTRALIA 12,800 359,437
NOVAGOLD RESOURCES, INC. - CANADA 32,850 244,733
-----------
4,421,834
-----------
HOME BUILDERS 1.6%
SEKISUI HOUSE LTD. - JAPAN 79,000 737,393
-----------
INDUSTRIAL CONGLOMERATES (ENERGY) 1.1%
AREVA - CI - FRANCE 420 491,278
-----------
INSURANCE 1.3%
MITSUI SUMITOMO INSURANCE GROUP HOLDINGS, INC. - JAPAN *16,800 579,147
-----------
MEDICAL EQUIPMENT & SUPPLIES 3.4%
ASTRAZENECA ADR - UNITED KINGDOM 17,200 731,516
SANOFI-AVENTIS - FRANCE 12,150 811,594
-----------
1,543,110
-----------
METALS & MINING 5.8%
LONMIN PLC - UNITED KINGDOM 3,800 241,497
IVANHOE MINES LTD. - CANADA 44,050 480,585
NEWMONT MINING CORP. - UNITED STATES 33,300 1,736,928
ACTIVA Mutual Funds Semiannual Report 29
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERNATIONAL FUND - 6/30/08 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ---------------------------------------------------------------------------------------------------------------------------
METALS & MINING (CONTINUED)
APEX SILVER MINES LTD. - CAYMAN ISLANDS 37,680 $ 185,009
-----------
2,644,019
-----------
OIL & GAS EXPLOR PROD & SER 8.2%
BP PLC - UNITED KINGDOM 123,300 1,432,250
PETRO-CANADA - CANADA 12,120 675,690
ROYAL DUTCH SHELL ADR-B - UNITED KINGDOM 14,435 1,156,388
SK TELECOM CO. LTD. ADR - KOREA 21,800 452,786
-----------
3,717,114
-----------
PAPER PRODUCTS 0.8%
UPM-KYMMENE OYJ - FINLAND 23,400 383,123
-----------
PETROLEUM-REFINING 2.9%
NIPPON OIL CORP. - JAPAN 197,000 1,322,982
-----------
PRINTING & PUBLISHING 3.2%
DAI NIPPON PRINTING CO., LTD. - JAPAN 98,000 1,444,570
-----------
PRECIOUS METALS 4.0%
BARRICK GOLD CORP. - CANADA *40,293 1,833,332
-----------
RETAIL STORES 1.8%
SEVEN & I HOLDINGS COMPANY - JAPAN 28,800 821,927
-----------
TELECOMMUNICATIONS 13.8%
ERICSSON (LM) TEL-SP ADR - SWEDEN 43,860 456,144
KT CORP. - KOREA 58,110 1,238,905
ALCATEL-LUCENT - FRANCE 156,000 947,985
NIPPON TELEGRAPH & TELEPHONE CORP. ADR - JAPAN 76,850 1,867,455
TELECOM ITALIA - ITALY 845,000 1,370,198
BELGACOM SA - BELGIUM 9,650 416,263
-----------
6,296,950
-----------
TOTAL COMMON STOCKS (Cost $43,287,978) 42,780,262
-----------
TOTAL INVESTMENTS - 100% (Cost $46,078,604) $45,570,888
===========
*Non-dividend producing as of June 30, 2008
30 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERNATIONAL FUND - 6/30/08 (Unaudited)
At June 30, 2008 the breakdown by country was:
% OF MARKET ACTUAL
COUNTRY VALUE MARKET VALUE
Australia 2.6% $ 1,192,086
Belgium 0.9% 416,263
Brazil 1.1% 476,340
Canada 10.7% 4,860,082
Cayman Islands 0.4% 185,009
Finland 2.3% 1,049,776
France 6.9% 3,108,556
Germany 3.4% 1,529,597
Italy 3.0% 1,370,198
Japan 33.0% 15,013,416
Republic of Korea 4.8% 2,214,771
Netherlands 2.8% 1,279,389
Papua New Guinea 1.2% 533,572
South Africa 7.2% 3,284,093
Sweden 1.0% 456,144
Switzerland 1.1% 512,391
United Kingdom 7.7% 3,561,651
United States 9.9% 4,527,554
----- -----------
100.0% $45,570,888
===== ===========
ACTIVA Mutual Funds Semiannual Report 31
The accompanying notes are an integral part of these financial statements.
ACTIVA Statement of Assets and Liabilities
INTERMEDIATE INTERNATIONAL
As of June 30, 2008 (Unaudited) BOND FUND VALUE FUND GROWTH FUND FUND
----------- ----------- ----------- -----------
ASSETS
Investments at cost $65,005,007 $79,845,952 $25,988,078 $46,078,604
----------- ----------- ----------- -----------
Investments at value 65,052,644 83,029,503 27,935,000 45,570,888
Collateral for securities on loan 2,379,129 7,640,242 3,038,051 11,922,116
Foreign currency held at fair value
(cost $56,087) -- -- -- 56,087
Receivables:
Securities sold -- 259,619 295,639 465,487
Investment income 587,925 136,734 20,070 94,039
Other assets 957 28,244 16,797 22,431
----------- ----------- ----------- -----------
Total Assets 68,020,655 91,094,342 31,305,557 58,131,048
----------- ----------- ----------- -----------
LIABILITIES
Payables - affiliate:
Advisory fees 62,289 131,879 49,048 100,185
Transfer agent fees 506 52,060 1,324 932
12b-1 fees 16,357 20,604 7,068 11,787
Service fees 40,893 54,950 17,669 29,466
Payables - general:
Collateral for securities on loan 2,379,129 7,640,242 3,038,051 11,922,116
Securities purchased -- 141,316 236,246 --
Due to broker - variation margin -- -- -- --
Other liabilities -- -- -- --
Accrued expenses 24,927 15,888 8,438 21,803
----------- ----------- ----------- -----------
Total Liabilities 2,524,101 8,056,939 3,357,844 12,086,289
----------- ----------- ----------- -----------
NET ASSETS $65,496,554 $83,037,403 $27,947,713 $46,044,759
=========== =========== =========== ===========
SHARES OUTSTANDING 6,643,056 9,934,360 3,252,566 4,901,662
=========== =========== =========== ===========
NET ASSET VALUE PER SHARE $9.86 $8.59 $9.39
Class A based on net assets of
$77,825,849 and 9,314,415
shares outstanding $8.36
Class R based on net assets of
$5,211,554 and 619,945
shares outstanding $8.41
32 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Statement of Operations
For the six month period ended June 30, 2008 (Unaudited)
INTERMEDIATE INTERNATIONAL
BOND FUND VALUE FUND GROWTH FUND FUND
---------- ------------ ----------- -----------
INVESTMENT INCOME
Interest $1,647,767 $18,975 $10,439 $13,398
Dividends -- 1,033,244 142,359 588,126
Miscellaneous 11,546 10,202 7,442 63,726
---------- ------------ ----------- -----------
Total Investment Income 1,659,313 1,062,421 160,240 665,250
---------- ------------ ----------- -----------
EXPENSES
Advisory fees 124,525 262,269 95,440 197,267
12b-1 fees 32,697 41,044 13,727 23,208
Service fees 70,993 94,749 29,862 50,443
Shareholder report 2,550 24,570 2,002 1,820
Fund accounting fees 29,732 26,936 21,294 22,568
Audit fees 31,478 14,742 14,742 14,742
Custodian fees 7,971 9,072 5,257 15,106
Insurance 4,507 3,948 1,227 1,999
Legal fees 6,552 6,209 6,209 6,307
Registration fees 1,820 3,360 910 1,456
Michigan state business tax 18,200 -- -- 26,400
Transfer agent fees 948 99,554 2,548 1,820
Transfer agent fees - Class R -- 5,334 -- --
Trustee fees 9,430 7,280 7,280 7,280
---------- ------------ ----------- -----------
Total Expenses 341,403 599,067 200,498 370,416
---------- ------------ ----------- -----------
Net Investment Income (Loss) 1,317,910 463,354 (40,258) 294,834
---------- ------------ ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS,
FOREIGN CURRENCY AND FUTURES CONTRACTS
Net realized gain (loss) from
security transactions 307,952 (4,043,268) 782,354 2,779,914
Net realized gain (loss) from foreign
currency transactions (5,603) -- -- (64,862)
Net realized gain (loss) from
futures contracts -- -- -- --
Changes in net unrealized appreciation
or (depreciation) of investments and
foreign currency (870,351) (6,487,517) (2,142,133) (4,568,721)
---------- ------------ ----------- -----------
Net Gain (Loss) from Investments,
Foreign Currency and
Futures Contracts (568,002) (10,530,785) (1,359,779) (1,853,669)
---------- ------------ ----------- -----------
NET INCREASE (DECREASE) IN
NET ASSETS RESULTING
FROM OPERATIONS $749,908 ($10,067,431) ($1,400,037) ($1,558,835)
========== ============ =========== ===========
ACTIVA Mutual Funds Semiannual Report 33
The accompanying notes are an integral part of these financial statements.
ACTIVA Statement of Changes in Net Assets
INTERMEDIATE BOND FUND VALUE FUND
PERIOD YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED
6/30/08 12/31/07 6/30/08 12/31/07
Increase (Decrease) in: (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
-------------------------- --------------------------
NET ASSETS FROM OPERATIONS
Net investment income (loss) $1,317,910 $3,080,456 $463,354 $1,764,785
Net realized gain (loss) on investments 302,349 (378,583) (4,043,268) 12,337,013
Net increase (decrease) in unrealized appreciation (870,351) 1,481,723 (6,487,517) (11,073,622)
----------- ----------- ----------- -----------
Net increase (decrease) in net assets resulting from operations 749,908 4,183,596 (10,067,431) 3,028,176
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income:
Class A (1,539,263) (3,053,266) 557 (1,719,046)
Class R -- -- -- (78,994)
Net realized gain from investment transactions:
Class A -- -- 2,158 (6,667,917)
Class R -- -- -- (292,555)
----------- ----------- ----------- -----------
Total distributions to shareholders (1,539,263) (3,053,266) 2,715 (8,758,512)
CAPITAL SHARE TRANSACTIONS Net proceeds from sale of shares:
Class A 63,251 31,052 2,318,585 2,924,398
Class R -- -- 670,230 1,563,838
Net asset value of shares issued to shareholders
in reinvestment of investment income and
realized gain from security transactions:
Class A 1,539,120 3,053,091 -- 8,242,884
Class R -- -- -- 371,549
Payment for shares redeemed:
Class A (81,714) (30,143,958) (3,691,978) (42,437,543)
Class R -- -- (295,420) (1,249,301)
----------- ----------- ----------- -----------
Net increase (decrease) in net assets derived from
capital share transactions 1,520,657 (27,059,815) (998,583) (30,584,175)
----------- ----------- ----------- -----------
Net Increase (Decrease) in Net Assets 731,302 (25,929,485) (11,063,299) (36,314,511)
Net Assets, beginning of year or period 64,765,252 90,694,737 94,100,702 130,415,213
----------- ----------- ----------- -----------
Net Assets, end of year or period $65,496,554 $64,765,252 $83,037,403 $94,100,702
=========== =========== =========== ===========
NET ASSETS CONSIST OF:
Capital $67,069,777 $65,549,120 $64,041,467 $65,040,049
Undistributed net investment income (loss) 56,605 -- 370,948 --
Return of capital -- (18,688) -- (92,963)
Undistributed net realized gain (loss)
from investments (1,678,224) (1,683,927) 15,441,437 19,482,547
Unrealized appreciation (depreciation) of
investments and foreign currency 48,396 918,747 3,183,551 9,671,069
----------- ----------- ----------- -----------
$65,496,554 $64,765,252 $83,037,403 $94,100,702
=========== =========== =========== ===========
TRANSACTIONS IN FUND SHARES
Shares sold:
Class A 6,299 3,150 258,677 297,777
Class R -- -- 76,400 156,459
Reinvested distributions:
Class A 153,895 310,896 -- 897,236
Class R -- -- 40,211
Shares redeemed:
Class A (8,304) (3,048,237) (423,632) (4,505,039)
Class R -- -- (32,870) (122,945)
----------- ----------- ----------- -----------
Net increase (decrease) in fund shares 151,890 (2,734,191) (121,425) (3,236,301)
Shares outstanding, beginning of year or period 6,491,166 9,225,357 10,055,785 13,292,086
----------- ----------- ----------- -----------
Shares outstanding, end of year or period 6,643,056 6,491,166 9,934,360 10,055,785
=========== =========== =========== ===========
34 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Statement of Changes in Net Assets continued
GROWTH FUND INTERNATIONAL FUND
PERIOD YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED
6/30/08 12/31/07 6/30/08 12/31/07
Increase (Decrease) in: (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
-------------------------- --------------------------
NET ASSETS FROM OPERATIONS
Net investment income (loss) ($40,258) ($48,245) $294,834 $384,013
Net realized gain (loss) on investments 782,354 3,315,279 2,715,052 6,315,119
Net increase (decrease) in unrealized appreciation (2,142,133) 1,200,264 (4,568,721) (1,937,350)
----------- ----------- ----------- -----------
Net increase (decrease) in net assets resulting from operations (1,400,037) 4,467,298 (1,558,835) 4,761,782
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income:
Class A -- -- -- (374,394)
Class R -- -- -- --
Net realized gain from investment transactions:
Class A -- -- -- (5,251,891)
Class R -- -- -- --
----------- ----------- ----------- -----------
Total distributions to shareholders -- -- -- (5,626,285)
CAPITAL SHARE TRANSACTIONS Net proceeds from sale of shares:
Class A 254,163 92,063 211,707 384,278
Class R -- -- -- --
Net asset value of shares issued to shareholders
in reinvestment of investment income and
realized gain from security transactions:
Class A -- -- -- 5,626,173
Class R -- -- -- --
Payment for shares redeemed:
Class A (150,014) (102,601) (227,497) (233,495)
Class R -- -- -- --
----------- ----------- ----------- -----------
Net increase (decrease) in net assets derived from
capital share transactions 104,149 (10,538) (15,790) 5,776,956
----------- ----------- ----------- -----------
Net Increase (Decrease) in Net Assets (1,295,888) 4,456,760 (1,574,625) 4,912,453
Net Assets, beginning of year or period 29,243,601 24,786,841 47,619,384 42,706,931
----------- ----------- ----------- -----------
Net Assets, end of year or period $27,947,713 $29,243,601 $46,044,759 $47,619,384
=========== =========== =========== ===========
NET ASSETS CONSIST OF:
Capital $27,497,007 $27,392,859 $43,264,178 $43,279,969
Undistributed net investment income (loss) (857,293) (817,035) (718,813) (948,786)
Return of capital -- -- -- --
Undistributed net realized gain (loss)
from investments (638,923) (1,421,277) 4,006,666 1,226,752
Unrealized appreciation (depreciation) of
investments and foreign currency 1,946,922 4,089,054 (507,272) 4,061,449
----------- ----------- ----------- -----------
$27,947,713 $29,243,601 $46,044,759 $47,619,384
=========== =========== =========== ===========
TRANSACTIONS IN FUND SHARES
Shares sold:
Class A 30,197 10,843 22,358 37,929
Class R -- -- -- --
Reinvested distributions:
Class A -- -- -- 594,733
Class R -- -- -- --
Shares redeemed:
Class A (17,880) (12,453) (24,901) (21,925)
Class R -- -- -- --
----------- ----------- ----------- -----------
Net increase (decrease) in fund shares 12,317 (1,610) (2,543) 610,737
Shares outstanding, beginning of year or period 3,240,249 3,241,859 4,904,205 4,293,468
----------- ----------- ----------- -----------
Shares outstanding, end of year or period 3,252,566 3,240,249 4,901,662 4,904,205
=========== =========== =========== ===========
ACTIVA Mutual Funds Semiannual Report 35
The accompanying notes are an integral part of these financial statements.
ACTIVA Notes to Unaudited Financial Statements
1. ORGANIZATION
Activa Mutual Fund Trust (Trust) was organized as a Delaware statutory trust on
February 2, 1998. The trust is an open-end management investment company
registered under the Investment Company Act of 1940 and consists of four funds.
The funds are: the Activa Intermediate Bond Fund (Intermediate Bond Fund), the
Activa Value Fund (Value Fund), the Activa Growth Fund (Growth Fund) and the
Activa International Fund (International Fund) and are collectively referred to
as the Funds. The Value Fund is the successor to Amway Mutual Fund.
2. INVESTMENT OBJECTIVES
The Intermediate Bond Fund's investment objective is to seek a high level of
current income as is consistent with moderate risk of capital and maintenance of
liquidity. The Intermediate Bond Fund invests primarily in investment-grade debt
securities, with average maturity of three to ten years.
The Value Fund's investment objective is to seek long-term capital appreciation,
and invests primarily in common stocks of U.S. companies which are considered by
the investment manager to be undervalued.
The Growth Fund seeks long-term growth of capital, and invests primarily in
common stocks believed by the investment manager to have long-term growth
potential.
The International Fund seeks maximum long-term capital appreciation. The
International Fund invests primarily in common stocks of non-U.S. companies
which the Fund believes to be undervalued by the marketplace with above-average
potential for capital appreciation.
Classes of Shares
The Value Fund offers two classes of shares (Class A and Class R). The Class R
shares are offered to tax-exempt retirement and benefit plans of Alticor, Inc.
and its affiliates, and are not subject to any sales charges or 12b-1
distribution fees. All other Funds issue a single class of shares. Each share
for all of the Funds, including Class A and Class R of the Value Fund represents
an equal proportionate interest in their respective Fund and, generally, will
have identical voting, dividend, liquidation, and other rights and the same
terms and conditions. Each class and Fund will have exclusive voting rights with
respect to matters affecting only that class or Fund. Each class and Fund bears
different distribution, shareholder servicing and transfer agent expenses.
Income, non-class specific expenses, and realized and unrealized gains or losses
on investments are allocated to each class of shares or Fund based upon its
relative net assets. Each Fund has authorized an unlimited number of shares.
3. SIGNIFICANT ACCOUNTING POLICIES
Security Valuation
Net asset values per share are calculated at the close of business on the New
York Stock Exchange, usually 4:00 PM Eastern time on each business day on which
that exchange is open. Investments in securities listed or admitted to trading
on a national securities exchange are valued at their last reported sale price
before the time of valuation. If a security is traded only in the
over-the-counter market, or if no sales have been reported for a listed security
on that day, it is valued at the mean between the current closing bid and ask
prices. Short-term securities maturing within 60 days are valued at amortized
cost, which approximates fair value. Portfolio debt securities with remaining
maturities greater than 60 days are valued by pricing agents approved by the
Board of Trustees. Foreign securities are converted to U.S. dollars using
exchange rates at the close of the New York Stock Exchange. Securities for which
market quotations are not readily available, including any restricted securities
(none at June 30, 2008), and other assets of the Funds are valued at fair market
value as determined by the Funds' Board of Trustees.
36 ACTIVA Mutual Funds Semiannual Report
ACTIVA Notes to Unaudited Financial Statements continued
Derivative Transactions
The Funds may trade in derivative contracts to hedge portfolio holdings and for
investment purposes. Hedging activities are intended to reduce various risks
associated with fluctuations in foreign currency exchange rates. When entering
into a forward currency contract, a Fund agrees to receive or deliver a fixed
quantity of foreign currency for an agreed-upon price on an agreed future date.
These contracts are valued daily. The Fund's net equity in the contracts is
included as unrealized gains or losses in the Statement of Operations. This
unrealized gain or loss is the difference between the forward foreign exchange
rates at the dates of entry into the contracts and the forward rates at the
reporting date. The current year change in unrealized gains and losses and
realized gains and losses are included in the Statement of Operations. These
instruments involve market risk, credit risk, or both kinds of risk, in excess
of the amount recognized in the Statement of Assets and Liabilities. Risks arise
from the possible inability of counterparties to meet the terms of their
contracts and from movement in currency and security values and interest rates.
There were no forward foreign currency exchange contracts during the period
ended June 30, 2008.
Futures Contracts
The Funds may use futures contracts to manage its exposure to the stock and bond
markets. Buying futures tends to increase a Fund's exposure to the underlying
instrument, while selling futures tends to decrease the Fund's exposure to the
underlying instrument or hedge other Fund investments. Futures contracts
involve, to varying degrees, risk of loss in excess of the futures variation
margin reflected in the Statement of Assets and Liabilities. The underlying face
amount and market value of any open futures contracts at period end is shown at
the end of the Schedule of Investments. This amount reflects each contract's
exposure to the underlying instrument at period end. Losses may arise from
changes in the value of the underlying instruments or if the counterparties do
not perform under the contract's terms. Gains or losses are realized upon the
expiration or closing of the futures contracts and are included in the Statement
of Operations. Futures contracts are valued at the settlement price established
each day by the board of trade or exchange on which they are traded.
Security Transactions
Security transactions are accounted for on the trade date. Dividend income is
recorded on the ex-dividend date. Interest income is recorded on the accrual
basis. Original issue discounts are accreted and premium is amortized on debt
securities to interest income over the life of a security with a corresponding
adjustment in the cost basis. Realized gains and losses from security
transactions and unrealized appreciation and depreciation of investments are
reported on a specific identification basis. Dividends and distributions to
shareholders are recorded by the Funds on the ex-dividend date.
Foreign Currency Translation
Investment securities and other assets and liabilities denominated in foreign
currencies are translated into U.S. dollar amounts at date of valuation.
Purchases and sales of investment securities and income and expense items
denominated in foreign currencies are translated into U.S. dollar amounts on the
respective dates of such transactions.
Net realized gains and losses from foreign currency and investment transactions
disclosed in the Statement of Operations consist of net gains and losses on
disposition of foreign currency, currency gains and losses realized between
trade and settlement dates on security transactions, and the difference between
the amount of net investment income accrued and the amount actually received in
U.S. dollars. Net unrealized foreign exchange gains and losses arise from
changes in fair values of assets and liabilities other than investments in
securities at period end, resulting from changes in exchange rates. The effects
of foreign currency
ACTIVA Mutual Funds Semiannual Report 37
ACTIVA Notes to Unaudited Financial Statements continued
exchange rates on foreign securities held are included in net realized and
unrealized gain or loss on investments.
Security Lending
The Funds lend portfolio securities from time to time in order to earn
additional income. The income recorded as a result of securities lending
transactions is included in miscellaneous income in the Statement of Operations.
The Funds receive collateral in the form of U.S. Treasury obligations, letters
of credit, and/or cash against the loaned securities, and maintain collateral in
an amount not less than 100% of the market value of the loaned securities during
the period of the loan. The market value of the loaned securities is determined
at the close of business of the Funds and any additional required collateral is
delivered to the Funds on the next business day. If the borrower defaults on its
obligation to return the securities loaned because of insolvency or other
reasons, the Funds could experience delays and costs in recovering the
securities loaned or in gaining access to the collateral. At June 30, 2008, the
value of the securities loaned and the collateral received were as follows:
Value of the Collateral
Fund Securities Loaned Received
- ---- ----------------- --------
Intermediate Bond $2,372,828 $2,379,129
Value $7,384,251 $7,640,242
Growth $2,964,313 $3,038,051
International $11,985,139 $12,419,461
The cash collateral received by the Funds is recorded as an asset and liability
in the Statement of Assets and Liabilities.
Fair Value Measurements
Effective January 1, 2008, the Funds adopted SFAS No. 157, Fair Value
Measurements (SFAS 157). This standard establishes a single authoritative
definition of fair value, sets out a framework for measuring fair value and
requires additional disclosures about fair value measurements. The three levels
of the fair value hierarchy are as follows:
o Level 1 - quoted prices in active markets for identical investments
o Level 2 - other significant observable inputs (including quoted prices
for similar investments, interest rates, prepayment speeds, credit
risk, etc.)
o Level 3 - significant unobservable inputs (including the Fund's own
assumption in determining the fair value of investments)
The inputs or methodology used in valuing securities are not necessarily an
indication of the risk associated with investing in those securities.
A summary of the inputs used to value the Fund's investments provided by the
Fund Accountant as of June 30, 2008 is as follows:
(Level 2)
Other (Level 3)
(Level 1) Significant Significant
Investment Quoted Observable Unobservable
Fund Category Prices Inputs Inputs Total
- ----------------------------------------------------------------------------------------------------
Intermediate Investments
Bond in Securities $ -- $65,052,644 $ -- $65,052,644
Intermediate Other Financial
Bond Instruments* -- -- -- --
Investments
Value in Securities 83,029,503 -- -- 83,029,503
Other Financial
Value Instruments* -- -- -- --
Investments in
Growth Securities 27,935,000 -- -- 27,935,000
Other Financial
Growth Instruments* -- -- -- --
Investments in
International Securities 45,094,547 476,341 -- 45,570,888
Other Financial
International Instruments* -- -- -- --
* Other financial instruments may include options, futures, swaps and forward
foreign currency contracts.
38 ACTIVA Mutual Funds Semiannual Report
ACTIVA Notes to Unaudited Financial Statements continued
Income Taxes
It is the Funds' policy to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to make distributions of
income and capital gains sufficient to relieve it from substantially all federal
income taxes. Foreign taxes are provided for based on each Fund's understanding
of the tax rules and rates that exist in the foreign markets in which it
invests.
Dividend Distributions
The Intermediate Bond Fund declares and distributes dividends monthly, and
capital gains (if any) are distributed annually. The Value Fund, Growth Fund and
International Fund declare and distribute dividends and capital gains (if any)
annually.
Use of Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
increases and decreases in net assets from operations during the reporting
period. Actual results could differ from those estimates.
New Accounting Standards
On January 1, 2007, the Funds adopted the provisions of FASB Interpretation No.
48 "Accounting for Uncertainty in Income Taxes, an Interpretation of FASB No.
109" (FIN 48). FIN 48 provides recognition criteria and a related measurement
model for tax positions taken by companies. In accordance with FIN 48, a tax
position is a position in a previously filed tax return or a position expected
to be taken in a future tax filing that is reflected in measuring current or
deferred income tax assets and liabilities. Tax positions are required to be
recognized only when it is more likely than not (likelihood of greater than
50%), based solely on the technical merits, that the position will be sustained
upon examination.
Tax positions that meet the more likely than not threshold should be measured
using a probability weighted approach as the largest amount of tax benefit that
is greater than 50% likely of being realized upon settlement. The Funds have
reviewed their tax positions and determined that there are no uncertain tax
positions. Accordingly, there have not been any adjustments made to these
financial statements related to FIN 48.
4. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
The Trust has entered into investment advisory agreements with Activa Asset
Management LLC (the Adviser), effective June 11, 1999. The Funds employ the
investment adviser to provide investment advice and manage on a regular basis
the investment portfolios for the Funds. Except when otherwise specifically
directed by the Funds, the Adviser will make investment decisions on behalf of
the Funds and place all orders for the purchase and sale of portfolio securities
for the Funds' accounts. The Adviser shall be permitted to enter into an
agreement with another advisory organization (sub-adviser), whereby the
sub-adviser will provide all or part of the investment advice and services
required to manage the Funds' investment portfolios as provided for in these
agreements. In return for these services, the Funds pay the adviser an annual
rate as follows:
FUND % OF AVERAGE NET ASSETS
- ---- -----------------------
Intermediate Bond .40% on first $50 million; .32% on next $100 million;
.24% on assets in excess of $150 million
Value .60% on first $100 million; .50% on assets in excess of
$100 million; the minimum annual fee shall be $350,000 plus
.20% of average net assets
Growth .70% on first $25 million; .65% on next $25 million; .60%
on assets in excess of $50 million
International .85% on first $50 million; .75% on assets in excess of
$50 million
ACTIVA Mutual Funds Semiannual Report 39
ACTIVA Notes to Unaudited Financial Statements continued
As permitted by the above agreements, the Adviser has retained the following
sub-advisers:
FUND SUB-ADVISER
Intermediate Bond McDonnell Investment Management, LLC
Value Wellington Management Company, LLP
Growth BlackRock Capital Management, Inc.
International Tradewinds Global Investors, LLC*
* Tradewinds Global Investors, LLC, became sub-adviser for the International
Fund effective April 1, 2005. Prior to that agreement, sub-advisory
services were provided by Nicholas Applegate Capital Management.
Pursuant to Rule 12b-1 under the Investment Company Act of 1940, the Value Fund,
Intermediate Bond Fund, Growth Fund and International Fund have entered into a
Plan and Agreement of Distribution with Activa Asset Management LLC. Under the
terms of the agreement, Activa Asset Management LLC provides services in
connection with distributing the Funds' shares (except Value Fund Class R). For
these services rendered, the Funds compensate Activa Asset Management LLC
monthly at a maximum annual rate of up to .25 of 1% of the average net assets of
the Funds. For the six month period ended June 30, 2008 the Board of Trustees
approved an annual rate of .10 of 1% of average net assets.
The Trust has a transfer agency and dividend disbursing agency agreement with
Activa Asset Management LLC. Under this agreement, Activa Asset Management LLC
is the agent for transfer of the Funds shares and disbursement of the Funds
distributions. For these services, the Intermediate Bond, Value (Class A),
Growth and International Funds pay a monthly fee based upon $2.00 per account in
existence during the month. The transfer agent is compensated by the Value Fund
(Class R) at a monthly rate of 1/12 of .20% (.20% annually) of average net
assets.
On June 11, 1999, as amended on June 3, 2004 and February 12, 2008, the Trust
has entered into an administrative agreement with Activa Asset Management LLC.
Under the terms of the agreement Activa Asset Management LLC acts as
administrator for the Funds. As administrator of the Funds, Activa Asset
Management LLC furnishes office space and office facilities, equipment and
personnel, as well as provides services relating to compliance, tax and
financial service requirements. For these services, the administrator is
compensated quarterly by each Fund at an annual rate of .15% of 1% of average
daily net assets. Effective March 1, 2008, the rate is .25% of 1% of average
daily net assets on the first $150,000,000 and .15% of 1% on the excess.
On July 9, 1999 the Trust entered into a Fund Accounting Agreement with Bisys
Fund Services Ohio, Inc. (Fund Accountant). As stated in the agreement, the Fund
Accountant is responsible for the maintenance of books and records, performance
of daily accounting services, providing the Funds' management with information
for the preparation of monthly financial statements and certain information
necessary for meeting compliance requirements. The Fund Accountant is
compensated by each Fund based upon an annual fee of $35,000 for assets up to
$100 million; $50,000 for assets between $100 million and $1 billion; and
$75,000 for assets in excess of $1 billion. In addition, each Fund pays the Fund
Accountant an annual fee of $2,500 for portfolio accounting reports provided to
adviser personnel through internet access.
Two families, which own (directly or indirectly) the majority of the shares
outstanding of each Fund, also indirectly own 100% of the Adviser.
5. INVESTMENT TRANSACTIONS
At June 30, 2008, the cost of investments owned by the Value Fund was
$79,845,952 for federal income tax purposes. Aggregate gross unrealized
appreciation on securities in which there was an excess of market value over tax
cost was $12,039,258. Aggregate gross unrealized depreciation on securities in
which there was an excess of tax cost over market value was $8,855,707. Net
unrealized appreciation for tax purposes was $3,183,551, at June 30, 2008.
40 ACTIVA Mutual Funds Semiannual Report
ACTIVA Notes to Unaudited Financial Statements continued
The unrealized appreciation (depreciation) at June 30, 2008 based upon cost of
both long-term and short-term securities for the Funds that have elected an
October 31st year-end for federal income tax purposes were as follows:
Net Cost for
Gross Gross unrealized federal
unrealized unrealized appreciation income tax
Fund appreciation depreciation (depreciation) purposes
- -----------------------------------------------------------------------
Intermediate
Bond $ 950,192 $ 903,151 $ 47,041 $65,005,603
Growth 3,066,857 1,177,483 1,889,374 26,045,626
International 5,005,060 5,512,777 (507,717) 46,078,604
Accumulated capital losses noted below represent net capital loss carryforwards
for federal income tax purposes,
as of December 31, 2007, that may be available to offset future realized gains
and thereby reduce future taxable gains distributions. Each Fund's tax-basis
capital gains and losses are determined only at the end of each fiscal year. The
table below shows the expiration dates of the capital loss carryovers.
December 31, December 31, December 31, December 31,
Fund 2010 2011 2014 2015
- --------------------------------------------------------------------
Intermediate
Bond $ -- $ -- $1,028,625 $ 542,659
Value -- -- -- --
Growth 1,331,773 1,828,921 -- --
International -- -- -- --
For the period ended June 30, 2008, each Fund purchased and sold securities,
excluding short-term securities, in the following amounts:
U.S. Government Obligations Other Securities
Fund Purchases Sales Purchases Sales
- ---------------------------------------------------------------------------
Intermediate
Bond $2,016,833 $1,690,874 $7,663,093 $7,690,922
Value -- -- 36,764,188 35,414,590
Growth -- -- 10,477,781 9,995,249
International -- -- 12,460,788 13,706,025
6. RELATED PARTY TRANSACTION
A certain class of Independent Business Owners of Alticor, Inc. received part of
their Emerald profit-sharing bonus in common stock shares of the Value Fund. On
January 10, 2008, Alticor, Inc. purchased 230,119 Value Fund shares valued at
$2,068,766 (based upon the net asset value of $8.99 per share) and transferred
the shares to these Independent Business Owners.
7. SUBSEQUENT EVENTS
On July 10, 2008 Amway Investment Corp., a principal shareholder of the Activa
Mutual Fund, redeemed $22,000,000 from the Activa International Fund, via a
redemption in kind which is a distribution of portfolio securities, rather than
cash as payment, for a redemption of Fund shares.
The Board of Trustees of the Activa Intermediate Bond Fund (the "Fund"), at its
meeting on June 17, 2008, voted to liquidate the Fund effective July 18, 2008.
Shareholders received a liquidating distribution as of July 18, 2008. Activa
Asset Management, LLC, the Fund's Investment Adviser, has agreed to pay the
expenses of the liquidation, if any.
ACTIVA Mutual Funds Semiannual Report 41
ACTIVA Financial Highlights
INTERMEDIATE BOND FUND VALUE FUND - CLASS A
---------------------------- -------------------------------
PERIOD YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED
6/30/08 12/31/07 6/30/08 12/31/07
Per share outstanding for each period (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
----------- ----------- ----------- -----------
Net Asset Value, Beginning of Period $9.98 $9.83 $9.35 $9.81
Income from investment operations:
Net investment income (loss) 0.23 0.44 0.05 0.14
Net realized and unrealized gains (losses) on securities (0.12) 0.15 (1.04) 0.09
----------- ----------- ----------- -----------
Total income from investment operations 0.11 0.59 (0.99) 0.23
Less Distributions:
Dividends from net investment income 0.23 0.44 -- 0.14
Dividends in excess of net investment income -- -- -- --
Distributions from capital gains -- -- -- 0.55
----------- ----------- ----------- -----------
Total Distributions 0.23 0.44 -- 0.69
----------- ----------- ----------- -----------
Net Asset Value, End of Period $9.86 $9.98 $8.36 $9.35
=========== =========== =========== ===========
Total Return * 1.14% 6.13% -10.59% 2.43%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $65,496,554 $64,765,252 $77,825,849 $88,679,133
Ratio of expenses to average net assets 0.5% 0.8% 0.7% 1.2%
Ratio of net income (loss) to average net assets 2.0% 4.4% 0.5% 1.4%
Portfolio turnover rate 14.6% 57.5% 40.8% 51.7%
VALUE FUND - CLASS R GROWTH FUND INTERNATIONAL FUND
-------------------------- -------------------------- --------------------------
PERIOD YEAR PERIOD YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
6/30/08 12/31/07 6/30/08 12/31/07 6/30/08 12/31/07
Per share outstanding for each period (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
---------- ---------- ----------- ----------- ----------- -----------
Net Asset Value, Beginning of Period $9.41 $9.86 $9.03 $7.65 $9.71 $9.95
Income from investment operations:
Net investment income (loss) 0.05 0.15 (0.01) -- 0.06 0.09
Net realized and unrealized gains
(losses) on securities (1.05) 0.10 (0.43) 1.38 (0.38) 0.98
---------- ---------- ----------- ----------- ----------- -----------
Total income from investment operations (1.00) 0.25 (0.44) 1.38 (0.32) 1.07
Less Distributions:
Dividends from net investment income -- 0.15 -- -- -- 0.09
Dividends in excess of net
investment income -- -- -- -- -- --
Distributions from capital gains -- 0.55 -- -- -- 1.22
---------- ---------- ----------- ----------- ----------- -----------
Total Distributions -- 0.70 -- -- -- 1.31
---------- ---------- ----------- ----------- ----------- -----------
Net Asset Value, End of Period $8.41 $9.41 $8.59 $9.03 $9.39 $9.71
========== ========== =========== =========== =========== ===========
Total Return * -10.63% 2.59% -4.87% 18.04% -3.30% 11.06%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $5,211,554 $5,421,569 $27,947,713 $29,243,601 $46,044,759 $47,619,384
Ratio of expenses to average net assets 0.6% 1.1% 0.7% 1.4% 0.8% 1.4%
Ratio of net income (loss) to
average net assets 0.6% 1.4% -0.1% -0.2% 0.6% 0.8%
Portfolio turnover rate 40.8% 51.7% 36.5% 98.8% 28.3% 50.1%
* The period ended June 30, 2008 is not annualized but an aggregate total
return for the period.
Performance data current to the most recent month end and the annualized
expense ratio may be obtained upon request by calling 800-346-2670.
42-43 ACTIVA Mutual Funds Semiannual Report spread
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Logo: Activa Mutual Funds
Activa Mutual Funds
2905 Lucerne SE, Suite 200
Grand Rapids, Michigan 49546
(800) 346-2670
www.activafunds.com
Printed in U.S.A.
ITEM 2. CODE OF ETHICS.
Not applicable at this time.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable at this time.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable at this time.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable at this time.
ITEM 6. SCHEDULE OF INVESTMENTS.
Included as part of the shareholder report.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to this registrant.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable to this registrant.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable to this registrant.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The Nominating Committee will consider nominees recommended by shareholders.
Recommendations by shareholders can be made in writing to the Fund.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial officer,
or persons performing similar functions, have concluded that the registrant's
disclosure controls and procedures (as defined in Rule 30a-3(c) under the
Investment Company Act of 1940, as amended (the "1940 Act") (17 CFR
270.30a-3(c))) are effective, as of a date within 90 days of the filing date of
this report, based on their evaluation of these controls and procedures required
by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or
15d-15(b) under the Exchange Act (17 CFR 240.13a-15(b) or 240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR
270.30a-3(d)) that occurred during the registrant's last fiscal half-year that
has materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
ITEM 12. EXHIBITS
- -----------------
(a) File the exhibits listed below as part of this Form. Letter or number
the exhibits in the sequence indicated.
(1) Any code of ethics, or amendment thereto, that is the subject of
the disclosure required by Item 2, to the extent that the registrant
intends to satisfy the Item 2 requirements through filing of an exhibit:
Not applicable at this time.
(2) A separate certification for each principal executive officer and
principal financial officer of the registrant as required by Rule 30a-2(a)
under the Act (17 CFR 270.30a-2(a)), exactly as set forth below: Ex-99.CERT
Attached hereto.
(3) Any written solicitation to purchase securities under Rule 23c-1
under the Act (17 CFR 270.23c-1) sent or given during the period covered by
the report by or on behalf of the registrant to 10 or more persons: Not
applicable to this registrant.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange
Act, provide the certifications required by Rule 30a-2(b) under the Act (17 CFR
270.30a-2(b)), Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR
240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of
the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished
pursuant to this paragraph will not be deemed "filed" for purposes of Section 18
of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of
that section. Such certification will not be deemed to be incorporated by
reference into any filing under the Securities Act of 1933 or the Exchange Act,
except to the extent that the registrant specifically incorporates it by
reference: Ex-99.906 CERT Attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Activa Mutual Fund Trust
-----------------------------------------------------------
By (Signature and Title)* /s/ Allan D. Engel
----------------------------------------------
Allan D. Engel
President, Principal Executive Officer and
Principal Financial Officer
Date September 3, 2008
-------------------------------------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Allan D. Engel
----------------------------------------------
Allan D. Engel
President, Principal Executive Officer and
Principal Financial Officer
Date September 3, 2008
-------------------------------------------------------------------
By (Signature and Title)*
----------------------------------------------
Date
-------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.